Steadfast Group Annual Report2023 Purpose: Create business solutions designed to help our Steadfast businesses and Network achieve better outcomes for their clients and the communities we serve. Vision: Continually growing shareholder value through our leading general insurance distribution model and related businesses domestically and internationally. Mission: Continue to deliver value to our broker Network and stakeholders by being a market leader and an innovator in insurance and risk management. Values: Our corporate values resonate across all facets of our business. Contents
02
04
07
08
10
13
20
22
25
44
54
78
Message from the Chair
Message from the Managing Director & CEO
Continued strong track record since listing on ASX
Message from the Chief Financial Officer
How we create value
Our business
Board of Directors
Senior Management Team
Environmental, Social and Governance
Directors’ Report
Remuneration Report
Financial Statements
Steadfast Group Annual Report 2023 01
Annual General MeetingThe Steadfast Group FY23 Annual General Meeting will be held on Friday, 27 October 2023. Steadfast will provide further details with the Notice of the 2023 Annual General Meeting to be released in September 2023.Contents Message from the Chair
On behalf of my fellow Board Directors, I am again pleased
to report outstanding earnings by Steadfast Group, with our
FY23 underlying net profit after tax (NPAT) at the top end of
our upgraded guidance range advised in February 2023.
In summary, in the year ended 30 June 2023 the Group
produced a 26.5% increase in underlying earnings before
interest, tax and amortisation (EBITA) to $430.7 million and
a 22.5% increase in underlying NPAT to $207.0 million.
Pleasingly, we reported an increase of 14.6% in underlying
earnings per share to 20.15 cents.
Statutory NPAT, after non-trading losses mainly due to
actual earnout payments for businesses acquired being
more than expected, was $189.2 million compared with
$171.6 million for FY22.
Dividend
The Board has declared a fully-franked final dividend of
9.0 cents per share (cps), up 15.4% from last year. This
Accumulated total shareholder return (%)
600
500
400
300
200
100
0
FY14
FY15
FY16
FY17
FY18
FY19
FY2 0
FY21
FY22
FY23
Capital management
We remain prudent with our capital management as
we assess potential acquisition opportunities against
our disciplined criteria. This year we made a number
of earnings accretive investments for a total outlay of
$574.2 million, with the largest acquisition being Insurance
takes the total dividend to 15.0 cps (fully-franked), up 15.4%
Brands Australia.
on FY22.
The Group's strong performance has continued since listing
in 2013. Our total shareholder return (TSR) was 22.5% for
FY23 and since listing was 497.7%.
The current active acquisition pipeline is around
$444.5 million. We anticipate completing $280 million of
this pipeline in FY24 funded by debt and free cash flow.
02 Steadfast Group Annual Report 2023
The Group's strong performance has continued
since listing in 2013.
At 30 June 2023, our Group gearing ratio was 19.0%
Thank you
(excluding premium funding) which is well within the Board-
mandated Group maximum of 30%. We consider a low level
of gearing is prudent given rising interest rates, inflation and
current uncertainties around the world. At the time of print,
Steadfast has unutilised facilities of $378.5 million (plus free
cash flow) for future expansion.
Governance
On behalf of the Board, I would like to thank our
Managing Director & CEO, Robert Kelly AM, and all
of the Steadfast team for their significant contribution
to delivering consistent outstanding results for our
shareholders and high quality support to our Network
brokers and other stakeholders.
Further, our continuing strong performance would not
Steadfast Group continues to adhere to the corporate
have been possible without the outstanding contribution
governance principles as set out by the ASX Corporate
from Steadfast Network brokers, Steadfast Underwriting
Governance Council. Our governance framework and robust
Agencies, our complementary businesses, our ever-
risk management strategies are set out in more detail
expanding network and the loyalty of our clients.
and is available on our investor website. I note another
year in which there were no material departures from
these principles.
During the year, Anne O’Driscoll retired as a director after 10
years at Steadfast. Anne assisted with Steadfast’s transition
from a broker network to listing on the ASX in August 2013.
Steadfast recognises that climate change continues to
Anne was appointed as a director and Chair of the Audit
be a global risk and that action is required to reduce
& Risk Committee of Steadfast Group on 1 July 2013. On
emissions over time as adequate solutions are introduced.
behalf of my fellow Board Directors, I would like to thank
In recognition of the issues arising from climate change, in
Anne for her outstanding contribution to the considerable
December 2022 Steadfast published the first phase of its
growth in shareholder value since listing.
carbon neutral transition plan. We set out our progress in
more detail on page 28 of this report.
Executive remuneration
The Board regularly reviews the remuneration of the senior
I would also like to extend my gratitude to my fellow
Board Directors who continue to be focused on driving
increased shareholder value, supporting the Steadfast team
and improving our already strong governance.
executives. Our remuneration policy takes into account
Finally, the Board appreciates the enormous support it
individual performance, market conditions, retention of our
receives from its shareholders, particularly in providing
quality team and encouragement to continue to outperform
additional capital to grow the revenue and profits. The
without increasing the risk profile of the Group. Our short-
Group’s outlook for FY24 is for further growth in profit and
term and long-term incentives are aligned to the growth
earnings per share.
in shareholder value. Independent advice is obtained on a
regular basis.
Frank O’Halloran AM
Chair
Steadfast Group Annual Report 2023 03
Message from the Managing Director & CEO
Once again, I am pleased to report that FY23, Steadfast's
10th year on the ASX, continues our year-on-year record
growth since its listing in August 2013. This year underlying
revenue increased by 24.1% to $1,409.5 million, underlying
EBITA increased by 26.5% to $430.7 million and underlying
NPAT increased by 22.5% to $207.0 million.
These results are the consequence of our enduring business
model, the skills and stability of our executive team, our
prudent approach to acquisitions and the strong
performance of our equity owned businesses. Our equity
broking businesses again benefited from acquisitions and
the continuation of the hard premium cycle, and our
underwriting agency businesses again experienced strong
organic growth over the year.
Steadfast Broking
In FY23 Steadfast Network broking gross written premium
(GWP) grew by 12.8% to $11.6 billion. This growth was again
driven by increased volumes over the year and further
premium rate increases by our strategic partners.
04 Steadfast Group Annual Report 2023
Steadfast Broker Network GWP ($b)
14
12
10
8
6
4
2
0
FY16
FY17
FY18
FY19
FY2 0
FY21
FY22¹
FY23
1 Restated for comparison purposes, with GWP from PSC
excluded from 1 July 2021
We have continued to deliver on our active acquisition
pipeline, seeking to increase our equity positions in
Network brokers.
Organic growth in revenues from our equity brokers more
SCTP enhancement is an important part of Steadfast’s
than mitigated the expected expense increase previously
strategy. The focus remains on continued development
flagged for FY23. Organic growth and strong acquisition
and more product lines, new insurers and the expansion of
growth resulted in excellent underlying EBITA growth from
auto-rating policy classes. The next commercial product line
our equity brokers of 27.7%.
under development is Farm, expected to be live in CY24.
We now have 426 brokerages in the Steadfast Network, with
Currently 205 brokers use our INSIGHT platform, with over
337 in Australia, 63 in New Zealand and 26 in Singapore.
6,000 users. The Steadfast team continues to support
Steadfast Group has equity holdings in 68 of the 426
the migration of brokers to INSIGHT with an additional
brokerages in the Steadfast Network. Steadfast's equity
16 brokers already committed to migrate and ongoing
brokers contribute approximately 50% of total sales. Further,
discussions with another 28 brokers.
the global network of our 60% owned UnisonSteadfast
encompasses another 271 brokerages across 115 countries.
Acquisitions
Steadfast Underwriting Agencies
In FY23, Steadfast made a number of earnings accretive
investments for a total outlay of $574.2 million, including the
Steadfast Underwriting Agencies continued to produce a
major acquisition of Insurance Brands Australia.
strong result with sustained organic growth, generating
$2.1 billion of GWP, a 16.7% uplift over FY22.
We have continued to deliver on our active acquisition
pipeline, where the Group is seeking to increase its equity
The GWP growth, combined with further premium price
positions in Network brokers.
increases by insurers, led to underlying EBITA growth
of 15.7%.
International expansion strategy
We currently have 29 specialist agencies offering over 100
niche products to the entire market.
Steadfast Technologies
Pleasingly, $1.2 billion of GWP was transacted on our
market-leading Steadfast Client Trading Platform (SCTP)
in FY23. Brokers continue to be attracted to the efficiency,
the ease of obtaining the best terms and tailored policy
wording (which are continually reviewed based on feedback
from our claims triage team) and the wide market access
to insurers that the platform delivers, together with our
product range which is market leading.
Steadfast continues to roll out more product and insurer
offerings on the SCTP, and the integration capacity
to onboard insurers more efficiently. During the year,
additional insurers were added for private motor, home,
landlords, residential strata and fleet.
We are excited about the potential for international
expansion of the Steadfast Network systems, and the
opportunities it provides to partner with distribution. We will
provide more detail on this expansion at the Steadfast 2023
Annual General Meeting.
$11.6b
Steadfast Network GWP
$207.0m
Underlying NPAT
Steadfast Group Annual Report 2023 05
Message from the Managing Director & CEO continued
The outlook for FY24 is for continued strong growth and
profitability on the back of our FY23 acquisitions, further
Trapped Capital acquisitions and organic growth.
Executive team changes
Outlook
I welcome Nigel Fitzgerald, who joined Steadfast as
Steadfast Group provides FY24 guidance of:
Chief Operating Officer in April 2023. Nigel brings an
extensive and diverse range of skills that complement
Steadfast’s revenue streams. We are delighted to have
such a high calibre executive further strengthen Steadfast’s
executive team.
underlying EBITA of between $500 million and
$510 million.
underlying NPAT of between $230 million and
$240 million.
underlying NPATA of between $277 million and
Nigel was appointed to the position of COO, with Samantha
$287 million.
Hollman commencing a new role as Chief Executive Officer
underlying diluted EPS (NPAT) growth of 10% to 15%.
of Steadfast International effective 1 March 2023. I would
like to congratulate Samantha on her new role.
Key assumptions underpinning this guidance have been
detailed within the Directors' Report on page 52 of
Succession
The test of any successful business is its ability to refresh
its views on the Executives who control the business and
provide exact pathways for promotion, retirement and
expansion. Successfully, over the past two years, a complete
review of existing and new positions has reset the team for
the foreseeable future and beyond.
this report.
Thank you
Again, a special thank you to our employees, Board
directors, Network brokers, Underwriting Agencies, our
complementary businesses, clients and strategic partners
for contributing to our continued record performance.
Lastly thank you to all our shareholders for their
ongoing support.
I am very proud of my highly experienced and hard-working
executive team. We look forward to continuing to work with
all our stakeholders to continue our strong track record.
Robert Kelly AM
Managing Director & CEO
06 Steadfast Group Annual Report 2023
Continued strong track record since listing on ASX
Steadfast Network GWP ($b)
Underlying NPAT ($m)
11.6
10.3
9.8
8.3
6.1
5.0 5.3
4.4 4.5
14
12
10
8
6
4
2
0
240
220
200
180
160
140
120
100
80
60
40
20
0
207.0
169.0
130.7
108.7
88.7
60.4 66.4
74.0
42.1
32.5
F Y15
F Y16
F Y17
F Y18
F Y19
F Y 2 0
F Y 21
F Y 2 2¹
F Y 23
F Y14
F Y15
F Y16
F Y17
F Y18
F Y19
F Y 2 0
F Y 21
F Y 2 2
F Y 23
1 Restated for comparison purposes, with GWP from PSC
excluded from 1 July 2021
Steadfast Underwriting Agencies GWP ($b)
2.1
1.8
1.5
1.3
1.2
0.9
0.8
0.7
2.5
2
1.5
1
0.5
0.4
0
F Y15
F Y16
F Y17
F Y18
F Y19
F Y 2 0
F Y 21
F Y 2 2
F Y 23
Underlying EPS (NPAT) (cents per share)
24
20
16
12
8
4
0
20.2
17.6
15.1
12.7
11.2
9.6
8.9
8.1
7.2
6.2
F Y14
F Y15
F Y16
F Y17
F Y18
F Y19
F Y 2 0
F Y 21
F Y 2 2
F Y 23
Underlying EBITA ($m)
500
Dividend Per Share (cents per share)
430.7
340.4
262.7
223.5
193.4
164.0
143.3
129.6
450
400
350
300
250
200
150
100
90.5
50
0
F Y15
F Y16
F Y17
F Y18
F Y19
F Y 2 0
F Y 21
F Y 2 2
F Y 23
426
Steadfast Network brokers
18
16
14
12
10
8
6
4
2
0
15.0
13.0
11.4
9.6
8.5
7.5
7.0
6.0
5.0
4.5
F Y14
F Y15
F Y16
F Y17
F Y18
F Y19
F Y 2 0
F Y 21
F Y 2 2
F Y 23
$1.2b
Steadfast Client Trading Platform GWP
Steadfast Group Annual Report 2023 07
Message from the Chief Financial Officer
Steadfast Group delivered its tenth consecutive record
Balance sheet
underlying result in FY23. The Group produced excellent
underlying earnings growth and continued to maintain its
strong working capital position and conservative gearing.
Reconciliation of earnings
Earnings were again translated into cash flow throughout
the year, with all Steadfast’s underlying NPATA converting
into cash, as a result of being in businesses with both low
working capital and capital expenditure needs.
Page 9 shows the reconciliation of earnings between the
This cash has been utilised to fund further acquisitions and
statutory profit and the underlying earnings.
pay increased dividends to shareholders.
Earnings per share and dividend growth
Steadfast Group’s balance sheet remains well positioned.
Strong underlying EBITA growth from organic growth
(+13.6%), and acquisitions (+12.9%), drove underlying
diluted EPS (NPAT) to 20.15 cents per share (+14.6%). This
allowed the Board to declare total dividends of 15.0 cents
per share (+15.4%). The total FY23 dividend represents a
At 30 June 2023, our corporate gearing ratio was 19.0%.
As of 16 August 2023, the Group had $378.5 million of
unutilised capacity available. There is significant headroom
in the corporate debt covenants. Total equity increased
during FY23 by 23.8% to $2,244.9 million.
payout ratio of 75%, in line with our target range of 65% -
The corporate debt facilities were uplifted to $860.0 million
85% of underlying NPAT.
Organic growth
Once again, Steadfast’s organic growth was driven by
in August 2023 and maturity dates extended. This facility will
allow us to fund further acquisitions in our Trapped Capital
pipeline and other opportunities being considered.
continued price increases by our strategic partners and
Thank you
market share gains from our underwriting agencies, and
Thank you to all the finance teams throughout the Group
solid volume increases from our Network brokers.
Acquisition growth
Acquisitions costing $574.2 million during the year
were financed from a combination of capital raised of
$310.1 million, utilisation of our debt facilities and the
balance from cash generated. The growth in EBITA for the
year was assisted by acquisitions made during the year and
the previous year.
who have participated in the production of all our financial
reporting needs. I appreciate the enormous amount of time
and effort that goes into the collation and analysis of the
financial data for the Group and to provide stakeholders
with quality and reliable performance metrics and the
financial statements.
Stephen Humphrys
Chief Financial Officer
08 Steadfast Group Annual Report 2023
2023
$'m
2022
$'m
Reconciliation of earnings:
Statutory NPAT
189.2
171.6
Deferred consideration expense
(where actual earnout was more
than expected)
Deferred consideration income (where
actual earnout was less than expected,
excluding IBA)
Net adjustment relating to IBA
acquisition (refer note 7F)
Impairment of non-IBA investments
Mark-to-market (losses)/gains from
revaluation of listed investments
Net gain from change in value or sale of
businesses and other movements
Underlying NPAT1
17.8
18.0
(1.4)
(5.5)
(0.5)
1.9
1.7
-
3.5
(1.6)
(1.7)
(17.0)
207.0
169.0
Underlying NPAT growth
22.5%
29.3%
Amortisation
Underlying NPATA
45.1
36.4
252.1
205.4
Underlying NPATA growth
22.7%
28.3%
Underlying NPATA ($m)
252.1
205.4
160.0
135.6
113.6
300
250
200
150
100
96.3
50
0
700
600
500
400
300
200
100
0
1
FY18
FY19
FY20
FY21
FY22
FY23
Net acquisition spend ($m)
552.0 574.2
134.9
95.5
155.1
172.0
FY18
FY19
FY20
FY21
FY22
FY23¹
$574.2m is the actual outlay of cash and/or shares to buy
economic interests in businesses.
Underlying Revenue
1,409.5
1,135.9
Underlying earnings per share (NPAT)
Underlying EBITA
Underlying NPAT
Underlying NPATA
Underlying EPS (NPAT) (cps)
Underlying EPS (NPATA) (cps)
430.7
207.0
252.1
20.15
24.55
340.4
169.0
205.4
17.58
21.37
1 For further information refer to Note 4 to the accounts.
22.7%
Underlying NPATA growth
19.0%
Gearing
and dividend (cents per share)
20.2
17.6
15.1
15.0
13.0
11.4
12.7
9.6
11.2
8.5
9.6
7.5
22
20
18
16
14
12
10
8
6
4
2
0
FY18
FY19
FY20
FY21
FY22
FY23
u Underlying earnings per share (NPAT)
u Dividend per share
Steadfast Group Annual Report 2023 09
How we create value
10 Steadfast Group Annual Report 2023
The risks inherent in our operating environment can also provide opportunities to create value. Our experienced team understands these factors and how they affect our business ensuring we are best placed to manage risks whilst capitalising on opportunities to deliver increased long-term value to our stakeholders.Market disruption:Changing technology & increasing data collection.Sector consolidation:SME brokers increasingly need support of an aligned network & equity investment.Regulatory change and increasing stakeholder scrutinyGreater transparency, climate change impact & workforce diversity.Capacity risk:Strategic partners seeking enhanced returns by increasing premium and more selective risk appetite, in response to increased frequency and cost of claims.Highly competitive landscape for talent:Attracting and retaining customer centric talent whilst offering increasingly flexible work arrangements.Increasing cybersecurity riskIncreased costs to protect our information.Steadfast is the largest general insurance broker network and largest group of underwriting agencies in Australasia. We have three business units focused on the intermediated general insurance market, being Steadfast Network brokers (in which we have an equity interest in 68 brokers), Steadfast Underwriting Agencies and the complementary businesses division.Policies & customers: Protecting businesses & consumers as a key component of risk mitigation against perils and disasters.Broker services: Providing our Network brokers with market-leading policy wordings for customers, global leading technology that continues to be refined and rolled out, providing efficient processes to administer risk management data transfer, training and service offering.426 network insurance brokerages: Advising clients on risk management solutions, especially SME solutions and personal lines.29 specialty underwriting agencies: Providing niche insurance products to the market.9 complementary businesses: Leading technology, premium funding solutions, other specialty advisory lines supporting the broker network and underwriting agencies.Our Operating EnvironmentOur Business ActivitiesWe aim to increase long-term value for all of our stakeholders.Careful analysis of the risks associated with our operating environment, our business activities and business value drivers and resulting value creation enables us to meet our strategic objectives. Steadfast Group Annual Report 2023 11
We use a range of resources and relationships to create sustainable value.People:Highly competent team, experienced in managing risks and converting opportunities, together with ethical behaviours to drive business performance.Product & advice:Steadfast suite of support services to our Network brokers Technology & data capabilities:Our leading technology provides clarity around alternative insurance solutions.Operational scale:The size and scale of our Network brokersand underwriting agencies and their underlying customers.A strong balance sheet: Access to debt & equity to execute our strategy and invest for sustainable earnings growth.Community & relationships:Localised relationships with local communities.Corporate governance:Proactively managing risk within strongcorporate governance framework to create sustainable longer-term growth.Our Business Value DriversnValue Creation OutcomeOur business value drivers ensure our business activities deliver consistent increases in value created for stakeholders.Shareholder value:Continued focus on long-term value creation through astute use of funds to deliver organic and acquisition growth in profits, dividends and shareholder value. Have achieved total shareholder return of 497.7% since listing.Customer value:Better outcomes for clients.• SCTP is a contestable digital marketplace generating improved pricing competition and coverage.• Market leading niche policy wordings.• Instant policy issue, maintenance & renewal, all on a market contestable basis.• Efficiency of delivery for clients. Employee value:Investment in our people to increase employee engagement through cultural, behavioural and skills-based developmental initiatives to drive business growth. In FY23:• 80% employee engagement score.• 4,155 hours of training.Community value:Connecting and investing in our community to support our business and industry.In FY23: • $757,000 donated to charitable causes.• $105.6 million income tax paid to the Australian Government. 12 Steadfast Group Annual Report 2023
Steadfast Group is committed to ensuring its Remuneration Framework rewards decision making by employees that aligns with the long-term interests of shareholders.Steadfast Group business units are primarily focused on the intermediated general insurance market. By working together, our business units empower Steadfast to serve our main goal – ensuring our brokers provide their clients with exceptional service and superior products. Steadfast Group
Steadfast Group was established in 1996 and is now the largest general insurance broker network and the largest
underwriting agency group in Australasia, with growing operations in Asia and the United Kingdom. We have grown the
Steadfast Network to 426 brokerages (of which Steadfast Group has equity in 68), built a portfolio of 29 underwriting
agencies and we have a 60% interest in the UnisonSteadfast network of 271 brokerages. Our business model is designed
to allow us to achieve sustainable growth via our Network brokerages and the equity positions we hold within the Network.
Our Steadfast Underwriting Agencies offer products to the entire broking market in Australasia and are also supported by
the Steadfast Network.
Our business
Steadfast Group has three business streams focused on servicing general insurance cients.
FY23 EBITA mix
u Steadfast Brokers
u Underwriting Agencies
59%
41%
Steadfast Group’s
business model is
designed to allow us
to achieve underlying
EBITA diversification,
providing stable
and reliable
financial performance.
Steadfast Group Annual Report 2023 13
Complementary businessesSteadfast Underwriting Agenciesunderwriting agencies9 businessessupporting the Steadfast Network and Steadfast Underwriting Agencies including Steadfast Technologies (100% owned)Mixture of wholly owned, part-owned and joint venture businesses2929 underwriting agenciesSteadfast GroupSteadfast Group was established in 1996 and is the largest general insurance broker network and the largest underwriting agency group in Australasia, with growing operations in Asia and Europe. We have grown the Steadfast Network to 427 brokerages (of which Steadfast Group has equity in 68), built a portfolio of 28 underwriting agencies and we have a 60% interest in the UnisonSteadfast network of 271 brokerages. Our business model is designed to allow us to achieve sustainable growth via our Network brokerages and the equity positions we hold within the Network. Our Steadfast Underwriting Agencies offer products to the entire broking market in Australasia and are also supported by the Steadfast Network. Our businessSteadfast Group has three business streams focused on servicing general insurance clients.Steadfast Group (listed on the ASX)Steadfast Broker Networkgeneral insurance brokerages with 1,882 offices426Steadfast Group has equity holdings in68 brokeragesSteadfast Group has equity holdings in all
14 Steadfast Group Annual Report 2023
Steadfast Broker NetworkWorldwide office network (excluding UnisonSteadfast)AsiaUKNew ZealandWANTSAQLDNSWVICACTTasmaniaAs part of the largest general insurance broker Network in Australasia, brokerages receive superior market access and exclusive products and services backed by the scale and expertise of the Group. This allows them to focus on servicing their clients’ insurance and risk management needs.18310346929493103811925119150Key benefits to brokers include:Steadfast Network GWP ($b)1Market-leading policy wordingsExclusive access to Steadfast proprietary technologyTools and support426 brokers in the Steadfast Network160+ exclusive products and services1 Excludes UnisonSteadfast2 Restated for comparison purposes, with GWP from PSC excluded from 1 July 2021.$b11109876543210FY22FY14FY15FY16FY17FY18FY19FY20FY2110.3FY239.88.36.15.35.04.54.44.111.62 Our clients
Steadfast Group is primarily focused on the SME market.
The SME market is advice-driven, which means that client
These relationships ensure that the SME market is more
loyal than the corporate market.
Diversified product offering and client base
relationships are key to Steadfast Network brokers, and
Steadfast Network brokers and Steadfast Underwriting
Steadfast Underwriting Agencies that provide niche advice
Agencies offer a diverse range of general insurance
and products for brokers.
products to their clients across Australasia. This diversity of
product and client base supports sustainable sales growth.
Diversified by client base
Diversified by product line
Diversified by geography
u Micro (policy size <$650)
u Small Enterprise (policy size
$650 - $5,000)
u Small Enterprise (policy size
$5,000 - $50,000)
u Medium Enterprise (policy size
$50,000 - $250,000)
u Corporate (policy size
>$250,000)
u Retail
1%
26%
40%
14%
6%
13%
u Business pack
u Commerical motor
u Retail
u Strata
u Professional risks
u Liability
u Commercial property & ISR
u Statutory covers
u Rural & Farm
u Construction & engineering
u Other
17%
12%
11%
10%
9%
9%
9%
8%
5%
5%
5%
u VIC
u NSW
u QLD
u WA
u NZ
u SA
u TAS
34%
27%
14%
12%
6%
4%
3%
Steadfast Group Annual Report 2023 15
A global broker network to access new markets for the Steadfast Network via inbound and outbound insurance placements.Steadfast Group has a 60% stake in UnisonSteadfast which is one of the largest global networks of general insurance brokerages with 271 brokerages across 115 countries.271brokerages115countries
16 Steadfast Group Annual Report 2023
Steadfast Underwriting Agencies is the largest underwriting agency group in Australasia.The agencies extend our intermediated general insurance distribution by offering brokers, inside and outside of the Steadfast Network, specialised products and capacity in niche markets.Steadfast Group has a majority equity stake in all 29 agencies.Our scale has led to better arrangements with insurers as well as back office cost savings. Investments in services and common IT systems are continually being made to create further value for our underwriting agencies.Steadfast Underwriting Agencies GWP ($b)1.31.51.20.90.80.80.40.11.8Steadfast Underwriting AgenciesFY22FY14FY15FY16FY17FY18FY19FY20FY21FY23$b2.01.81.61.41.21.00.80.60.40.202.1 Steadfast Group Annual Report 2023 17
ReReinsurance BrokersLifeOur insurTechSteadfast Technologies provides exclusive, market-leading technology to support broker and underwriting agency operations which underpins interactions with our insurer partners to support client outcomes.This technology positions us as a global leader in broker insurance technology (insurTech) and facilitates our strong market position.Steadfast Client Trading Platform (SCTP): a contestable digital marketplace giving brokers access to domestic, commercial and strata policies offered by the insurers that connect to the platform, allowing comparisons of policies and prices on a single screen. back office system for brokers offering a single view of their business. Nine complementary businesses support the operations of the Steadfast Network and Steadfast Underwriting Agencies.Back office system Contestable digital marketplaceInsurer partnersSteadfast Network brokers Complementary businessesClient 18 Steadfast Group Annual Report 2023
Contestable digital marketplace generating greater pricing competition and improved coverage, as well as alignment of client and broker interests through fixed commission rates. Market-leading policy wordings. Instant policy issue, maintenance and renewal, all on a market contestable basis. Supported by Steadfast claims triage.SCTP benefits for clients:SCTP benefits for brokers: Automated access to Steadfast Network for all policies placed on the platform. Significantly reduced technology and distribution costs. Data analytics and market insights, live at all times. Updated policy wordings, based on prior claims scenarios.SCTP benefits for insurers: Automated market access to leading insurers. Bespoke market-leading policies. Fixed commission, same for all insurers. In-depth data analytics. Stimulates advisory discussions with clients on their insurance programs with major market players.Our insurTech continuedInsurer and underwriting agency partners on the SCTPBusiness packProfessional risksCommercial property & ISRCommercial motorStrataKey: indicates insurers joining SCTP product lines LiabilityDomestic home, motor & landlords CY23 CY23 Steadfast Group Annual Report 2023 19
Life $26bPrivate health $27bNon-intermediatedIntermediated ($35b)Non-intermediated (direct) ($29b)$117bAustralianinsurancemarketSteadfast Network brokers CY22 GWP $11.5b$35bintermediatedmarketGeneral $64bAustralian market gross written premium1Key market The intermediated general insurance market consists of insurance brokers and underwriting agencies. Australia is Steadfast Group’s largest market, with intermediated GWP of $35 billion generated in calendar year 2022, of which our insurance broker network has a 33% share.We are a key distribution channel for our insurer partners as the Steadfast Network has a large and diverse client base across Australia.Over our 25 year history, Steadfast Group has developed strong relationships with carefully selected insurers, underwriting agencies and premium funders and strategic partners that support the Steadfast Network.Our partnersStrategic partner1 APRA Quarterly General Insurance Performance Statistics for year ended December 2022 (released March 2023), APRA Quarterly Private Health and Life Performance Statistics for year ended March 2023 (released May 2023), Steadfast Group and APRA Intermediated General Insurance Performance Statistics for year ended December 2022 (released March 2023).Major insurer partners Premium funding partnersSteadfast Group is focused on the intermediated general insurance market, with a primary focus on SME. Board of Directors
20 Steadfast Group Annual Report 2023
Frank O'Halloran AM
Non-Executive Chair (independent)
Chair Nomination Committee
Frank had over 35 years’ experience at QBE where he was Group CEO from
1998 until 2012. He also worked with Coopers & Lybrand for 13 years where
he started his career as a Chartered Accountant. Frank was President of the
Insurance Council of Australia from 1999 to 2000 and was inducted into
the International Insurance Hall of Fame in 2010. Frank received his AM for
services to the insurance industry and philanthropy.
Robert Kelly AM
Managing Director & CEO
Robert co-founded Steadfast and has over 52 years’ experience in the
insurance industry. He was voted the second most influential person in
insurance by Insurance News, and was awarded the ACORD Rainmaker
Award in 2014. Robert is a Qualified Practising Insurance Broker, a Fellow
of NIBA, a Senior Associate of ANZIIF, a Certified Insurance Professional
and a Fellow of the Australian Institute of Company Directors. Robert is the
Chair of the ACORD Board and is also a Director of ASX-listed Johns Lyng
Group Limited and not-for-profit organisation KidsXpress.
Vicki Allen
Non-Executive Director (independent)
Chair Remuneration & Performance Committee
Vicki has over 30 years' of business experience across the financial services
and property sectors. She held senior executive roles at a number of
organisations including Trust Company, MLC Limited and Lend Lease
Corporation. Vicki is currently the Chair of the BT Funds board, and
a Non-Executive Director of Bennelong Funds Management, ING Bank
(Australia) Ltd and New Forest Pty Ltd. She is a Fellow of the Australian
Institute of Company Directors.
Joan Cleary
Non-Executive Director (independent)
Chair Audit & Risk Committee
Joan has over 30 years' of finance and leadership experience in the general
insurance and reinsurance industry. She held senior executive roles at a
number of organisations in Australia and England including QBE Insurance
Group Limited, and GE’s London Market reinsurance operations. Joan holds
a Bachelor of Laws from the University of Exeter. She is a Fellow of the
Institute of Chartered Accountants in England and Wales (ICAEW) and is a
Graduate of the Australian Institute of Company Directors.
David Liddy AM
Deputy Chair & Non-Executive Director (independent)
David has over 45 years’ experience in banking, including postings in
London and Hong Kong. He was Managing Director of Bank of Queensland
from 2001 to 2011. He is a Fellow of the Australian Institute of Company
Directors. David received his AM for services to the banking and finance
sectors and the community of Queensland.
Gai McGrath
Non-Executive Director (independent)
Chair People, Culture & Governance Committee
Gai has over 35 years’ experience in the financial services and legal
industries, including 12 years with Westpac Group as General Manager of
Westpac’s retail banking businesses in Australia and New Zealand. Gai is
currently Chair of BT Super. She is a Director of Helia Group, HBF Health
and Toyota Finance Australia. Gai is a Graduate of the Australian Institute
of Company Directors.
Greg Rynenberg
Non-Executive Director (independent)
Greg has over 43 years’ of experience in the insurance broking industry,
with 39 years spent running his own business, East West Group. East West
Group is a Steadfast Network broker not owned by Steadfast. Greg is a
Qualified Practising Insurance Broker, a Fellow of NIBA and an Associate
of ANZIIF. He holds an Advanced Diploma in Financial Services (General
Insurance Broking) and was named NIBA Queensland Broker for 2014.
Steadfast Group Annual Report 2023 21
Senior Management Team
Robert Kelly AM
Managing Director & CEO
Stephen Humphrys
Chief Financial Officer
Nigel Fitzgerald
Chief Operating Officer
Robert co-founded Steadfast and
has over 52 years’ experience in
the insurance industry. He was
voted the second most influential
person in insurance by Insurance
News, and was awarded the ACORD
Rainmaker Award in 2014. Robert
is a Qualified Practising Insurance
Broker, a Fellow of NIBA, a Senior
Associate of ANZIIF, a Certified
Insurance Professional and a Fellow
of the Australian Institute of
Company Directors. Robert is the
Chair of the ACORD Board and is also
a Director of ASX-listed Johns Lyng
Group Limited and not-for-profit
organisation KidsXpress.
Stephen joined Steadfast in 2013
and has over 30 years’ experience
as a Chartered Accountant and
extensive experience in acquisitions,
integration of networks and
developing businesses. As Managing
Director of Moore Stephens Sydney
for 10 years and Chair of Moore
Stephens Australasia for three,
Stephen played a key role in
placing Moore Stephens into
the top 10 accounting firms in
Australia. Stephen is a Fellow
of Australia and New Zealand
Chartered Accountants.
Nigel Fitzgerald joined Steadfast
Group in April 2023 as Chief
Operating Officer. Nigel has worked
in the insurance industry for over 25
years with a proven track record in
leading profitable and strategically
dynamic businesses on a global
basis, including fulfilling leadership
roles while living in New York,
London, Houston, Singapore and
Sydney. Prior to Steadfast, Nigel
fulfilled CEO and Board Director
roles for AIG and Fairfax Financial
and Senior Executive roles for
Liberty International Underwriters.
Samantha Hollman
Chief Executive Officer
International
Samantha has 28 years' experience
in the insurance industry including
23 years at Steadfast. She was COO
from September 2016 – April 2023,
directing and managing operational
activities of the organisation and
ensuring the implementation of
the overall strategy. Samantha
was promoted to the new
role of CEO – International
and is responsible for planning
and executing the Company’s
international strategy. Samantha sits
on the UnisonSteadfast Supervisory
Board and is a Board Director of
Steadfast (UK) Group.
Allan Reynolds
Executive General Manager
Asia, New Zealand & Domestic
Linda Ellis
Group Company Secretary
& Corporate Counsel
Munashe Bhowa
Chief Risk Officer
Allan joined Steadfast in 2002, and
in April 2015 took on the Domestic,
New Zealand & Singapore portfolios.
With a background in product
development and distribution,
corporate strategy and portfolio
management, Allan has more than
50 years' experience in general
insurance. He holds a Diploma of
Business Studies (Insurance), is a
Certified Insurance Professional and
is a Fellow, honorary member and
former Chair of ANZIIF.
Linda is Group Company Secretary
& Corporate Counsel at Steadfast
Group Limited and has been
part of the Executive team since
2013. Before joining Steadfast,
she specialised in mergers and
acquisitions and worked in Sydney
and London at global law firms. Linda
is a Fellow of the Australian Institute
of Company Directors, a member of
Chief Executive Women, and holds
a BEc and LLB (Hons I) from The
University of Sydney and is a national
ambassador of Heads Over Heels.
Munashe joined Steadfast in
February 2016 and has over 15
years' experience in audit (internal
and external), risk management and
compliance. Munashe is responsible
for enhancing Steadfast’s risk
management and compliance
frameworks. Prior to joining
Steadfast Munashe worked at
Ernst & Young, working on
audits, and gaining experience
in risk management and
compliance. Munashe holds a
Bachelor of Accounting Science
with majors in Accounting and
Auditing and is a member of the
Institute of Internal Auditors.
Sheila Baker
Executive General Manager
Compliance &
Customer Experience
Sheila Baker joined Steadfast
in October 2020, following our
purchase of Goldseal, which
specialised in the provision of
Compliance, HR and Training and
Education Services. Sheila has
been involved in Goldseal since its
establishment and has in excess of
20 years' of experience in service
provision to the broking sector.
22 Steadfast Group Annual Report 2023
Nick Cook
Executive General Manager
Partners, Broker Services
& Agencies
Nick, who joined Steadfast in
February 2015, had over 15 years’
experience at Zurich Financial
Services, including three as the
Head of Customer & Proposition
Development and nine years as
a distribution manager. He is a
member of the NIBA Board and
an Associate ANZIIF member. He
has graduated from both the
AGSM Leadership Program and
the Prosci Organizational Change
Management Program.
John O'Herlihy
Executive General Manager
Operations & Acquisitions
Jeff Papps
Executive General Manager
Operations & Acquisitions
Duncan Ramsay
General Counsel &
Company Secretary
John joined Steadfast in 2012
and is joint lead of the
Operations and Acquisitions team.
Having completed his professional
accounting training with KPMG in
1996, John has spent over 15
years working within the insurance
industry. During this time he has
held a number of senior finance
and operational roles in both North
America and Australia specialising
in corporate transactions. John is a
Fellow of the Institute of Chartered
Accountants Ireland.
Jeff joined Steadfast in 2012 and
is joint lead of the Operations and
Acquisitions team. Prior to joining
Steadfast, Jeff worked for PwC
specialising in financial services.
After transferring from London
to Sydney in 1998, he focused
on mergers and acquisitions,
leading domestic and cross border
transactions and listings across
Australia, Asia, Europe and North
America. Jeff is a Member of
the ICAEW.
Duncan joined Steadfast in June
2014 after 20 years at QBE where
he was Group General Counsel
and Company Secretary. Duncan's
career commenced in 1986 with
Freehills in Sydney. He holds degrees
in commerce and law, and a
graduate certificate in applied risk
management. Duncan is a Fellow
of ANZIIF and the Governance
Institute of Australia, as well as a
graduate of the Australian Institute
of Company Directors.
Peter Roberts
Executive General Manager
Business Solutions
Chris Rouse
Executive General Manager
Technology
Shalome Ruiter
Executive General Manager
Investor Relations & ESG
Martyn Thompson
Executive General Manager
Corporate Development
Peter joined Steadfast in 2013 and
focuses on back office outsourcing
opportunities for the Group. He was
also Managing Director of White
Outsourcing until stepping down on
30 June 2016 to concentrate on his
role at Steadfast Business Solutions.
Peter has over 35 years’ experience
in accounting and back office
services to the financial services
sector, and commenced his career
in accounting with KPMG. Peter is a
company secretary of Steadfast.
Chris joined Steadfast in 2020, and
has over 20 years of experience
working in senior IT management,
technology, audit and cybersecurity
roles. Prior to joining Steadfast,
Chris was the Chief Information
Officer at Law In Order working
on projects such as the Royal
Commission into Misconduct in
the Banking, Superannuation and
Financial Services Industry. He is
a Certified Information Systems
Security Professional (CISSP) and
member of both ISC2 and ISACA.
Shalome joined Steadfast in
October 2019 and has 25 years’
experience working in the financial
markets and funds management
industries. During this time, she has
held a number of investor relations
and communications roles for ASX
listed companies. Shalome holds a
Bachelor of Business and a Graduate
Diploma of Applied Finance.
Martyn joined Steadfast with over
35 years’ experience as an insurance
broker, the previous 29 years working
in senior roles for the global broker,
Willis Towers Watson. During this
tenure, he was National Client
Service Director responsible for
implementing service platforms
and standards across the network,
including providing risk and
insurance solutions to many ASX
companies, government and multi-
national organisations. He is a
Senior Associate ANZIIF, holds
a Diploma of Financial Services
and a Graduate Certificate in
Business Administration.
Steadfast Group Annual Report 2023 23
24 Steadfast Group Annual Report 2023
We think about the long-term success of our business from the perspectives of our shareholders, our people, customer advocacy, the environment and contributing to our communities. Environmental, Social and Governance
Our Environmental, Social and Governance philosophy
Our Environmental, Social and Governance (ESG) philosophy outlines our commitments
to managing ESG risks. We think about the long-term success of our business from the
perspectives of our shareholders, our people, customer advocacy, the environment and
contributing to our communities.
Our commitment to the environment
Improving our environmental performance by minimising the environmental impact
of our operations through reducing emissions.
Minimising the environmental impact of our Network brokers and underwriting agencies
by expanding our support to them as we transition to a lower carbon economy.
Our commitment to people
Creating a safe, caring, inclusive and ethical culture for our people to enable them to thrive.
Making a positive impact in our communities by supporting businesses and communities to
effectively identify, mitigate and manage risk.
Supporting our Network brokers to meet and exceed the expectations of their clients and the
broader communities in which they operate.
Our commitment to strong and effective governance
Implementing strong and effective corporate governance that is underpinned
by our ethical and responsible culture.
Being a good corporate citizen by focusing on doing the right thing and acting responsibly,
always.
Steadfast Group Annual Report 2023 25
ESG
United Nations Sustainable Development Goals alignment
We have considered how we can help make a difference to some of the world's most pressing environmental and social
challenges. Given the nature of our business and our sphere of influence, we are focusing on five United Nations Sustainable
Development Goals (UN SDGs) which are aligned with our business and culture, and against which we feel we can have
most impact.
26 Steadfast Group Annual Report 2023
NO POVERTY GOOD HEALTH & WELLBEINGGENDER EQUALITYDECENT WORK & ECONOMIC GROWTH CLIMATE ACTIONAlignment of Steadfast's ESG philosophy with UN SDGs Our actions in relation to the identified UN SDGs are set out below.
No poverty
Decent work and economic growth
Insurance protects individuals and businesses
when disaster strikes, providing a safety net
against poverty and building financial wellbeing.
Our brokers and underwriting agencies are proud
to provide their clients with insurance solutions
and advice. We demonstrate our support for this
goal through:
Advice provided by our brokers and
underwriting agencies.
Donations provided by Steadfast Foundation.
Fire protection products being developed by
Flame Security International (FSI).
Good health and wellbeing
Steadfast strives for good health and wellbeing
outcomes for our people and much
of our charitable giving is directed to improving
health outcomes in our community. To do this, we
focus on:
Steadfast's work place culture.
Employee health, safety & wellbeing.
Employee talent development.
Donations provided by Steadfast Foundation.
Gender equality
We are committed to gender equality as a sound
business practice and because it is the right thing
to do. Diversity, equity and inclusion are important
in our business. We also promote gender equality
through supporting initiatives outside Steadfast.
We demonstrate our support for this goal through:
Woman in Leadership target.
Champions of Change membership.
Diversity, equity & inclusion committee.
Insurance is a key factor in enabling
sustainable economic growth. We provide advice
about insurance products supporting workers
continuing their employment through our workers’
compensation business, accident & health and life
insurance solutions. We demonstrate our support
for this goal through:
Advice provided by our brokers and
underwriting agencies.
Our Reconciliation Action Plan.
Respecting human rights and rejecting
modern slavery.
Being a jobsupport employer.
Climate action
We are committed to improving our environmental
performance by minimising the environmental
impact of our operations through addressing
climate change and the transition to a lower-carbon
economy. We demonstrate our support for this
goal through:
Carbon neutral transition plan (CNTP).
Green travel policy.
Green energy.
Carbon offsetting.
Electronic waste recycling.
FSl.
Landcare Australia Sponsorship.
Steadfast Group Annual Report 2023 27
Environment
Steadfast recognises that climate change continues to
be a global risk and a material issue for the insurance
industry, including insurers, customers, and the broader
economy. As the consequences of global climate change
are continuing to be increasingly apparent, Steadfast has
committed to making our operations more sustainable,
and to use our influence in supporting our Network
brokers and underwriting agencies to minimise their
environmental impact.
Our commitments to the environment include:
Our primary focus
is to reduce our
operating emissions
intensity, with the
balance to be offset
with carbon credits.
improving our environmental performance by minimising
Our FY23 carbon footprint
the environmental impact of our operations through
The estimated results have been calculated in alignment
reducing emissions; and
with the GHG Protocol and are set out below:
minimising the environmental impact of our Network
brokers and underwriting agencies by expanding
our support to them as we transition to a lower
carbon economy.
Scope 1 tCO2e
Scope 2 tCO2e
FY22
FY23
261
667
601
980
OUR COMMITMENT:
To improve our environmental performance
through operating emissions reduction
Our total carbon emissions footprint increased as Steadfast
continued to make Trapped Capital acquisitions, our people
returned to the office after Covid lockdowns, and our
Supporting our environmental commitment, in December
Network broker's fleet use increased with more in-person
2022 Steadfast published the first phase of our carbon
client meetings.
neutral transition plan (CNTP).
Our emissions target
We understand this plan needs to evolve. Steadfast will
continue to review our CNTP, improve our data collection
Steadfast aims for a reduction in the intensity of our
processes and work with our supply chain to understand
operating emissions (scope 1 & 2), with a target for
the options to reduce our scope 3 impact. For further
our Australian controlled businesses to be carbon neutral
information, our CNTP is available from our investor website.
by 2030.
Our carbon neutral roadmap
Green travel policy
Steadfast recognises that travel, especially air travel, has
Our primary focus is to reduce our operating emissions
a direct impact on the environment. We try to reduce
(scope 1 & 2) intensity, with the balance to be offset with
the need for unnecessary business travel and encourage
carbon credits. Given Steadfast’s scope 1 & 2 emissions arise
the use of more sustainable forms of transport across
predominately from petrol consumption and electricity use,
our operations.
our strategy to reach carbon neutral by 2030 includes
implementing two abatement options:
Green power procurement
Transitioning to electric vehicles
Our green travel policy seeks to embed some of the Covid
adjustments we have made to the way we do business,
including the use of virtual meetings and reduce in our
environmental impact, including a reduction in emissions
associated with work-related travel.
28 Steadfast Group Annual Report 2023
Carbon offsetting
We have reduced our impact on the environment by
offsetting the carbon emissions for much of our corporate
travel. This financial year Steadfast purchased 828 carbon
offset units to retire 1,078 tCO2e from the corporate
Strategic investment in Flame Security International (FSI)
travel undertaken across the Group. We direct our carbon
Fire is a global threat. Through our investment in
offsetting to a portfolio of projects through Tasman
Environmental Markets.
Electronic waste recycling
FSI, we want to bring new risk management offerings
to the Network brokers and their clients to protect
people, structures and the environment from fire threats,
insurance coverage challenges and consequent increases in
This financial year Steadfast recycled 494kg of mixed
insurance premiums.
electronic waste in our Bathurst Street office. The e-waste
recycling service accepts a wide variety of e-waste such
as: desktops, laptops, servers, mobile phones, monitors,
printers, handheld devices, switches, TVs, modems,
speakers, batteries, USB devices, and IT accessories.
OUR COMMITMENT:
Minimising the environmental impact of our
Network brokers and underwriting agencies by
expanding our support
Sharing our knowledge
Given the nature of our business and our sphere of influence,
we strive to enhance knowledge of climate change impacts
and expand the support we provide to our Network brokers
and underwriting agencies, encouraging them to reduce
their carbon footprint.
FSI has developed a range of eco-friendly fire protection
solutions. FSI’s wildfire and polymer coating products
are designed to better protect humans, property,
infrastructure, flora and fauna from the ravages of wildfire
which is progressively worsening as a consequence of
global warming.
FSI is dedicated to eco-friendly fire retardant products
that use non-toxic materials which are not harmful to
the environment and are produced using eco-friendly
production processes and sustainable materials.
We are engaging with our Network brokers and underwriting
Landcare Australia sponsorship
agencies to act on climate by increasing awareness and
enabling sustainable behaviour changes.
Data collection
We will continue to improve our data collection processes
to increase the amount of primary data collected. This will
enable us to use these insights to identify further emission
reduction opportunities.
As a leader in the environmental sector and in recognition
of the success Landcare Australia has achieved in its efforts
to improve biodiversity, build resilience in Australia’s food
and farming systems, and create stronger communities,
Steadfast continued its support of Landcare this year.
Steadfast Group Annual Report 2023 29
30 Steadfast Group Annual Report 2023
A strong culture, grounded in integrity and accountability, is essential to the achievement of our purpose, vision and strategy. Social
Our purpose
Create business solutions designed to help our Steadfast businesses and network achieve better outcomes for their clients
and the communities we serve.
Our culture
A strong culture, grounded in integrity and accountability, is essential to the achievement of our purpose, vision and strategy.
Culture is key to ensuring that how we go about doing our work and is just as important as what gets achieved.
Our commitment to people
Creating a safe, caring, inclusive and ethical culture for our people to enable them to thrive.
Making a positive impact in our communities by supporting businesses and communities to effectively identify, mitigate and
manage risk.
Supporting our Network brokers to meet and exceed the expectations of their clients, and the broader communities in which
they operate.
Our values
Our corporate values resonate across all facets of our business.
=
Steadfast Group Annual Report 2023 31
OUR COMMITMENT:
Creating a safe, caring, inclusive, and ethical culture
for our people to enable them to thrive
Diversity, equity & inclusion (DE&I)
Steadfast aims to provide a workplace where people feel
they can bring their whole-self to work. We believe that we
perform better as a business with diverse people and an
inclusive culture. It helps us attract, retain and motivate the
best people.
We continually strive to foster a workplace where individuals
feel safe, valued and encouraged to be their true selves
every day. We aim to create a diverse work environment
in which everyone is treated fairly and with respect and
where everyone feels responsible for the reputation and
performance of Steadfast. The Board and management
believe that Steadfast’s commitment to diversity and
inclusion contributes to achieving Steadfast’s corporate
objectives and embeds the importance and value of
diversity within the culture of Steadfast.
We do not tolerate discrimination, harassment or vilification
and employees undertake annual training supporting our
commitment to inclusion.
encouraging
managers to
promote the
committee’s
work to their
teams.
As part of our
ongoing
commitment to
improve our
gender diversity,
Steadfast
previously set an aspirational target for Women in
Leadership of 45% by 2024. We believe this better aligns our
business with the diversity within our society. This year our
females in leadership roles was stable at 44%. We are proud
to be an endorsed employer by WORK180, recognising
Steadfast's commitment to gender diversity.
To support our diversity, this year we implemented a new
Leave Swap Policy, which allows employees to swap up to
three state or federal public holidays each year for another
day that is important to them.
Steadfast’s DE&I Strategy and its Diversity Policy focus on
gender, LGBTQIA+ and disability. By surveying our people,
we established that they are passionate about these areas
which helped shape the framework of our DE&I.
Steadfast also continued our support of the employment
service for people with moderate intellectual disability
through the government organisation, Jobsupport. We
currently have two Jobsupport employees.
The DE&I committee has sought to embed DE&I
importance by regular promotion in all staff update
forums, showcasing initiatives at employee inductions and
32 Steadfast Group Annual Report 2023
Audit & Risk CommitteePeople, Culture & Governance CommitteeNomination CommitteeRemuneration & Performance Committee BoardFormerly Head over HeelsSteadfast works with and supports organisations aligned with our DE&I framework Gender
Non-Executive Directors
Senior executives
Group-wide leadership
u Male
u Female
50%
50%
u Male
u Female
72%
28%
u Male
u Female
56%
44%
Group-wide employees
Promotions and transfers
Participants in our manager
development program
u Male
u Female
51%
49%
u Male
u Female
53%
47%
u Male
u Female
44%
56%
Ethnicity & age
Head office employees
place of birth
Workforce language
diversity
Age diversity
u Born outside Australia
u Born in Australia
42%
58%
u Non-english speaking
background
u English speaking background
30%
70%
u Between 21 and 30 years old
u Between 31 and 40 years old
u Between 41 and 50 years old
u Over 51 years old
21%
34%
24%
21%
Steadfast Group Annual Report 2023 33
This year the Group-wide employee engagement score
was 80%.
Workplace culture
We are very proud of our culture. Our greatest strength is
our people. Our people are the cornerstone of Steadfast’s
success and providing an engaging and rewarding culture is
an important aspect of our employee attraction, retention
and engagement strategy.
All our people undertake training on the standards
of behaviour that are expected and these are also
encapsulated in our corporate governance policies such
as our Code of Conduct. All our people have objectives on
culture and values.
In March each year, Steadfast conducts our annual
Steadfast Group Dragon Boat team
employee engagement survey which measures the
emotional connection people have to the Group. This
year, with a participation rate of 80%, the Group-wide
engagement score was 80%, up from 78% in 2022. This
result continues to place Steadfast in the ‘high performing’
zone of the engagement spectrum.
Our voluntary staff turnover rate was 12.5%, a decrease from
20.7% in FY22 and 3.5% below the insurance industry FY23
benchmark. Our average current employee tenure is four
years and eight months with Steadfast.
Average employee tenure
FY20
FY21
FY22
FY23
4 years and 1 month
4 years and 2 months
4 years and 8 months
3 years and 6 months
Steadfast Group Touch of Colour team
Steadfast offers an Additional Leave Purchase Scheme
enabling our people to salary sacrifice to acquire additional
annual leave to facilitate a better balance between
professional and personal lives.
We continue to implement initiatives designed to engage
employees and build relationships, including our intranet,
Steadfast has a short-term employee incentive plan to
regular staff meetings and briefings, a formal performance
increase market competitiveness and attract, retain and
review process, participation in a number of community
motivate our people. The scheme has been designed to
events, quarterly off-site workshops and social activities,
ensure goal alignment throughout the business and also
such as participating in Dragon Boat racing and in the Touch
provides our people with the opportunity to receive shares
of Colour, an annual touch football event which brings the
in Steadfast. As well as salary and incentive arrangements,
insurance industry together to raise funds for KidsXpress, a
Steadfast offers a wide-ranging benefits program for our
children's mental health charity.
people including travel insurance and discounts on a wide
range of consumer goods and cars.
34 Steadfast Group Annual Report 2023
We respect the
human rights of our
employees, customers
and those of
our suppliers and
business partners.
Human rights and modern slavery
Steadfast rejects any form of modern slavery such as
slavery, servitude, human trafficking and forced labour. We
aim to identify and manage risks related to human rights
across our business and supply chain. Our Modern Slavery
Statement 2023 sets out our position on this matter and is
available from our investor website.
As part of our commitment to human rights, Steadfast is
a member of The Freedom Hub, an organisation that helps
people who have experienced human trafficking and slavery.
The Freedom Hub Survivor School provides survivors with
long-term support by running free, personalised classes to
assist them in recovering from trauma and become ready
to work.
Steadfast complies with relevant laws, community
expectations and ethical standards related to human rights
and modern slavery in respect of our employees and
business. Employees are encouraged to report any genuine
concerns about modern slavery relating to our people,
business or supply chain.
Health, safety and wellbeing
The wellness of our people is a priority and we actively
promote their health, safety and wellbeing. During the
financial year we had no reportable work, health and
safety incidents.
Reportable work, health and safety incidents
FY20
FY21
FY22
FY23
9
2
0
0
Our Board receives regular work, health and safety
(WHS) reports. We have a committee to provide a forum
for our people to suggest initiatives and raise any concerns.
In May 2023, Safety Australia Group undertook an audit of
our Workplace Health and Safety management systems and
arrangements finding Steadfast to be compliant.
Further, in FY23 Steadfast undertook activities to ensure a
proactive approach to the prevention of sexual harassment
and other forms of anti-social behaviour such as bullying,
victimisation, and harassment.
Steadfast provides a comprehensive health and wellbeing
program. Some of our initiatives include:
Annual health assessments and flu shot.
Insurance and protection benefits.
A range of education and awareness of key health
and wellbeing issues including physical fitness, nutrition,
mental health and stress management.
Annual financial wellbeing health check.
Access to confidential external Employee Assistance
Programs (EAPs) for counselling to support mental health.
Training – 5% of staff have been trained as mental health
first aid officers.
Steadfast supports flexible workplace initiatives to
recognise and respond to people’s different needs at
different stages of their lives and to help our people balance
personal obligations with their careers. Currently 100% of
our workforce works within a hybrid working model.
During the financial year, Steadfast maintained our Family
Friendly Workplace accreditation by Parents at Work and
UNICEF Australia. Family Friendly Workplaces strive to
reduce the tension that exists between work and family
by embedding and promoting policies and practices that
genuinely support employees to thrive at work and at home.
We offer paid parental leave at 12 weeks’ full pay. We engage
with our people when they are on parental leave, if they
wish, to maintain a sense of connectedness and ease the
transition back to work. Steadfast provides a parents’ room
in our head office as a practical support for the increasing
number of new parents in our team and to ease their
transition back to work.
Steadfast Group Annual Report 2023 35
All of our people
completed at least
one training program
in FY23
Talent development
We actively create a culture of learning and invest
in developing our people. Steadfast has a formal
talent development strategy and a dedicated training
and development team that delivers training programs
throughout the year at all levels. This financial year, our
people completed 4,155 hours of in-person learning and
training, an average of 9.15 hours per person and an increase
of 1,284 hours from FY22.
Career growth
Steadfast’s College of Leadership offers our current and
future leaders the opportunity to develop by exposing
them to forward-thinking, relevant and practical leadership
methodology and application. In addition to leadership
and management training, our people participate in annual
development planning to ensure their continued technical
and non-technical development. During the year, 19
Steadfast employees were promoted internally, of whom
nine were female employees.
Developing female talent
During the financial year 141 of our leaders from
across the business participated in our various leadership
training programmes, with 57% of the participants being
female employees.
Developing young talent
At Steadfast, we recognise the importance of developing
young talent. This year Steadfast's Graduate Development
Program was recognised at The GradAustralia Top 100
Graduate Employers Awards as the Best in Industry (Banking
& Financial Services Sector) for Diversity & Inclusiveness.
36 Steadfast Group Annual Report 2023
Further demonstrating its success, Steadfast has retained
13 of the 16 graduates who have participated in our program.
Additionally, Steadfast’s Summer Intern Program continues
to offer six roles to school leavers each year. We are
delighted with the quality of people who have joined us,
and stayed, through these programs.
OUR COMMITMENT:
Making a positive impact in our communities
Volunteer day program
Steadfast’s volunteer day program encourages our people
to donate their time by way of volunteering at a registered
charity of their choice. All of our people have the opportunity
to receive a day of paid employment off to volunteer. This
year Steadfast employees donated 270 hours volunteer
time, which reflects an 8% participation rate.
Steadfast's marketing team volunteer day for The Salvation Army
Support for Aboriginal & Torres Strait Islander peoples
Indigenous talent program sponsorship
Underwriting Agencies of Australia (UAA), a Steadfast
business, has been instrumental in building a unique and
critically important Indigenous Talent ID Program (ITID) for
indigenous athletes, offered by the Regional Academies of
Sport (RAS) across regional NSW. Annually the RAS network
identifies close to 1,000 talented indigenous athletes, and
provides approximately 140 fully funded scholarships into
RAS sporting programs. The ITID Program is now one of the
largest talent identification programs on offer throughout
the Regional Academy network.
Reconciliation Action Plan
the school to loan some laptops for extended periods as
part of their equity and diversity program.
Steadfast became a member of Supply Nation. Supply
Nation provides Australia’s leading database of verified
Indigenous businesses. During FY23 Steadfast sourced
chocolates from Chocolates on Purpose and used Print
Junction to print our FY22 Annual Report.
Mitch Tambo, Didgeridoo player, traditional indigenous
dancer and singer, opened the 2023 Steadfast
Convention held in Perth with a Welcome to Country
and performance for attendees.
To celebrate National Reconciliation Week, Steadfast
was delighted to have the National Indigenous Culinary
Institute’s Alumni Chefs prepare and serve employees
lunch featuring native ingredients in the Sydney and
Melbourne offices, while sharing their knowledge of the
food’s history and traditional uses.
Steadfast supports a number of indigenous charities,
including the Indigenous Literacy Foundation and the
Earbus Foundation.
Our RAP commitment lays the foundations for us to
establish meaningful and long-term relationships and
contribute to reconciliation in a structured, relevant and
respectful way. The Steadfast Reconciliation Action Plan is
available here and from our investor website.
Steadfast is in the second phase of our Reconciliation
Action Plan (RAP) called Innovate. The RAP Committee has
continued to expand its knowledge and understanding of
Aboriginal and Torres Strait Islander history and culture by
researching and identifying areas where Steadfast can have
a positive impact on the social and economic wellbeing of
indigenous Australians.
Some of the initiatives we have implemented to raise
awareness and encourage a deeper understanding of
Aboriginal and Torres Strait Islander peoples include:
We recognised NAIDOC Week in July 2023 to celebrate
the history, culture and achievements of Aboriginal and
Torres Strait Islander peoples.
Cultural Walking Tours in Sydney and Melbourne
are offered to all employees to provide a deeper
and meaningful understanding of Aboriginal cultures,
histories, knowledge and rights through cultural learning.
Over 90 staff have attended the tours to date and we will
continue this initiative in FY24.
Steadfast formed a new partnership with the EM-Power
Foundation, a not-for-profit company whose purpose
is to increase opportunities for indigenous people to
secure sustainable economic, health, cultural and social
benefits through participation in the native agriculture and
food sectors.
The EM-Power Foundation facilitated an introduction to
Dubbo College Senior Campus. For the last two years,
the campus has had the largest number of indigenous
graduates in NSW high schools. We gifted 13 laptops to
date to indigenous students completing HSC who are
going on to university next year for their use, as well as for
Steadfast Group Annual Report 2023 37
Our Innovate RAP actionsBuild relationships with Aboriginal and Torres Strait Islander peoples and use sphere of influenceBuild relationshipsRespectOpportunitiesGovernanceIncrease understanding and demonstrate respect by observing cultural protocolsExpand employment pathways and outcomes through recruitment and retentionAccountability and transparency through reporting RAP achievements OUR COMMITMENT:
Support our Network brokers to meet and exceed
customer expectations
Our brokers and their clients
We prioritise what matters to our brokers and strive to
Broker training
The Steadfast Learning Hub was launched in January 2023
to provide training to our Network brokers. Since the
Learning Hub commenced to 30 June 2023, the Goldseal
team has delivered 13,575 hours of training, through over 90
deliver an outstanding broker service and support to enable
courses to our Network brokers.
Steadfast Network brokers and their clients to thrive.
Examples of the support provided include:
Risk services
Steadfast Risk Group provide our Network brokers with a
Online learning modules
Webinar attendance
unique suite of risk management tools that can help them
PD Day and Town Hall attendance
detect, determine and monitor key strategic and operational
risks in a structured and manageable way. By thoroughly
Broker and customer advocacy
Hours of learning
7,738
5,837
5,080
evaluating and understanding potential risks, clients can
make informed decisions and take proactive measures
to protect their interests. With an ever-evolving threat
landscape, incorporating comprehensive risk assessments
into a broker's renewal process helps their client's resilience.
Key benefits to being a Steadfast Network broker include
improved policy wordings, broker services, exclusive access
to Steadfast’s technology and triage support for challenging
claims. Pivotal to our philosophy and values is that brokers
work for their client, not the insurer. Steadfast Group
Aspire Women in Leadership Program
supports our brokers with our dedicated triage team
Steadfast again joined Hollard Insurance to help develop the
next group of female leaders via the Aspire Women Leaders
Program in 2023. The Aspire Women Leaders Program is
a year-long development program specifically tailored to
Steadfast female insurance intermediaries who are looking
available to support brokers with the claims process by
ensuring their client’s claims are managed in line with
wording and service expectations. We provide support with
issues such as placement, ethics and natural disasters, and
assisting brokers by escalating these issues when required.
to become future business leaders.
Steadfast's triage team provided the following assistance to
Although improving, there are still steps to be taken to
ensure that women are at least equally represented and
valued in management and executive positions in our
Network brokers:
industry. We have demonstrated our commitment to our
Claims support
female brokers and offer a dedicated leadership program.
Placement issues
Ethics issues
FY23
669
220
9
FY22
664
306
15
Further, the objective of Steadfast Goldseal Customer
Advocacy Program is to “Make every client of a Steadfast
business the sole focus of every broking transaction, the
broker will act in the client’s best interest – whether that
coincides with their own best interest or not”. The Steadfast
customer advocacy service was established in October
2021 and has since assisted in 67 customer advocacy cases.
The Aspire Women Leaders Program offers a curated
program of relevant and topical courses that are designed
to provide leadership skills and advance participants careers
within the insurance broking industry.
38 Steadfast Group Annual Report 2023
Responsible selling practices
The Steadfast Broker Code of Conduct includes the following drivers and behaviours, to support brokers to meet and exceed
the expectations of their customers and the broader community.
Steadfast's Broker Code of Conduct
FY23 progress
1. Expansion of Steadfast's internal audit and risk resources
2. Steadfast will educate, inform and encourage its Network brokers to no longer engage in the
practice of accepting volume-based incentives and/or soft dollar benefits.
3. Steadfast will require transparency of remuneration from all Network brokers in all
dealings with their customers. This will require an undertaking from Network brokers that all
remuneration will be transparently documented in their transactions with their customer base.
4. Steadfast will facilitate elevated levels of excellence in the services provided by its Network
brokers through:
Driving higher quality standards of training and education.
Meeting clients and legislative expectations in a reasoned and compliant approach to
advice, conduct and ultimate outcome.
Maintaining an appropriate trail of the documentation and fact gathering that supports the
placement of any client insurance policies / programs or claims handling.
We will review and bolster our licence agreements with our Network brokers to ensure
compliance with:
best practice standards
regulations
laws
relevant codes (including the Steadfast Code of Conduct)
which will be incorporated into conduct standards, included in the licence agreements and
integrated into Network brokers’ operations.
5. Steadfast’s Broker Code of Conduct will clearly and emphatically focus on the best interests
of Network brokers’ clients and, as such, we will review existing policies, procedures and
resources provided to ensure brokers receive all encouragement and assistance they may
need to meet the same expectation.
6. Steadfast Goldseal will be the public face for the Network’s customer advocacy function,
providing the consumer with an advocate to present any issues where the Network has not
complied with the customer’s expectation for the services provided.
Steadfast expanded its internal audit
and risk resources with the integration
of Goldseal.
Education and information has been
provided to our Network brokers
through our PD days and Town
Hall events.
Steadfast is aligned with the
NIBA Insurance Broker Code of
Practice. Under the code, remuneration
transparency will be required by
November 2023. Goldseal is preparing a
guide to implementing the changes for
our Network brokers.
As a minimum standard to advise
clients, Steadfast has mandated the
Diploma of Insurance Broking. This is
aligned with NIBA.
Online learning module “Record
Keeping" provided by Goldseal’s Broker
Best Practice series. It is available on
the Learning Hub at no cost to our
Network brokers.
A revised Licence Agreement was
released to our Network brokers in
September 2022.
Completed an initial review of existing
policies and procedures to ensure
Steadfast's Broker Code of Conduct
principles are reflected in them. The
review is on going.
Details of the Customer Advocacy
program have been provided to our
Network brokers through our PD days
and Town Hall events.
7. Steadfast will establish a reference checking and information sharing service to record
details of Network employees or authorised representitives who have acted in contravention
of accepted industry ethical standards, allowing the Network to identify individuals during the
recruitment process who do not uphold Steadfast’s high standards.
Details of this standard have been
published on the broker website and
provided through our PD days and Town
Hall events.
8. Steadfast will play a leadership role with NIBA to enhance the industry’s training and
qualification requirements and work with regulators to increase the recognition of the Qualified
Practising Insurance Broker (QPIB) designation.
9. Steadfast will complete a compliance and best practice audit of Network brokers.
QPIB designation has been promoted
to Network brokers through the
newsletter and Town Hall session. This
promotion is on going.
Completed 35% of equity broker
reviews scheduled for CY 2023.
Our Network brokers are guided by regulation and comply with the financial services laws to deliver responsible selling
practices to meet their clients' requirements.
Steadfast Group Annual Report 2023 39
Governance
OUR COMMITMENT:
Implementing strong and effective corporate
governance that is underpinned by our ethical and
responsible culture.
Sound compliance
Data privacy and cyber security
Data privacy and cyber security are paramount within
our knowledge-driven business. We recognise the intrinsic
value of information and its pivotal role in our operations.
Therefore, ensuring the security and confidentiality of data
is one our highest priorities.
Building and maintaining trust with our brokers and strategic
The Steadfast Board of Directors follows sound corporate
partners is crucial for the success of our business. By
governance and the ASX Corporate Governance Council
safeguarding data and information, we enable our brokers
Principles and Recommendations. FY23 was another year
to establish and nurture relationships with their customers,
in which there were no material departures from our
fostering a sense of confidence and reliability.
governance framework and risk management strategies.
Whistleblower policy
To uphold these principles, we implemented
comprehensive policies and procedures during the
Steadfast Group’s whistleblower policy encourages people
year including:
to report or disclose corruption, fraud, tax evasion or
Cyber security strategy development.
avoidance, misconduct and improper states of affairs within
the corporate sector and provides appropriate protections
to whistleblowers to facilitate the uncovering of corporate
crime and to combat poor compliance. There were no
material whistleblower incidents reported during the year.
A range of security processes enhancements were
undertaken at the Steadfast Head Office.
Expansion of our Security Operations Centre capabilities.
Introduced additional cyber security controls to assess
third-party risk in our supply chain and vendor
Industry engagement and leadership
assessment process
A number of our senior executives hold leadership roles
We remain vigilant in the face of emerging threats
within the industry such as serving on the board of
by actively monitoring the technology landscape. Our
industry bodies. Our executives contribute by speaking
proactive approach includes adhering to all relevant
at industry events and judging industry awards. Our
legislation and staying up to date with the latest risk
executives are recognised throughout the industry and
management standards. Additionally, we maintain constant
receive accolades for their leadership and contribution.
communication with industry bodies and government
Working with the industry body, NIBA, Steadfast continues
agencies, exchanging information and best practices
to play a leading role in seeking to ensure that the insurance
to ensure our security measures align with the latest
broker industry stays strong, delivers excellent outcomes for
developments in the field.
customers and meets its legal and ethical obligations from
a regulatory perspective.
Over the past 12 months, we have not experienced any
breaches that necessitate formal notification.
By implementing robust security measures, we strive to
prevent unauthorised access, data breaches, and other
cyber threats.
40 Steadfast Group Annual Report 2023
Charities are often chosen based on the recommendations
of Steadfast brokers, and include cancer research and
support, mental health, children’s causes and charities
supporting victims of domestic violence, the homeless
and disadvantaged. Some of the charities the Steadfast
Foundation supported this year include: Assistance Dogs
Australia, Children’s Cancer Institute, Sir David Martin
Foundation, DV Collective, Earbus Foundation WA, Free 3D
Hands, FSHD, Horse Aid, Indigenous Literacy Foundation,
KidsXpress, Magic Moments, McGrath Foundation, Mirabel
Foundation, Motion by The Ocean, Myeloma Australia,
Super Tee, The Pyjama Foundation, Transafe WA, Telethon
Speech and Hearing, and Youth Off The Streets.
OUR COMMITMENT:
Being a good corporate citizen by focusing on doing
the right thing and acting responsibly, always.
Steadfast Foundation
The Steadfast Foundation is in its 12th year and the New
Zealand Steadfast Foundation is in its sixth year.
Steadfast created the Steadfast Foundation to facilitate
grants and charitable contributions that support charities
helping people to overcome adversity, with $757,000
donated during FY23 to charities. Since its inception, the
Steadfast Foundation has donated over $4,500,000 to
registered charities.
The Steadfast Foundation portal is a workplace giving
platform that enables Steadfast staff to participate and
engage in the Foundation's mission. The portal enables all
staff to easily take part in regular workplace giving and
make pre-tax salary donations. For every dollar donated by
staff, Steadfast Group Ltd will match contributions dollar for
dollar, capped at an annual total of $100,000.
Steadfast Group Annual Report 2023 41
Steadfast Foundation 42 Steadfast Group Annual Report 2023
Steadfast Group is committed to ensuring its Remuneration Framework rewards decision making by employees that aligns with the long-term interests of shareholders.Steadfast’s mission is to continue to deliver value to our Broker Network and stakeholders by being a market leader and an innovator in insurance and risk management. Contents
Directors’ Report
Operating and financial review
Remuneration Report
Lead Auditor's Independence Declaration
Financial Statements
Consolidated statement of profit or loss and other comprehensive income
Consolidated statement of financial position
Consolidated statement of changes in equity
Consolidated statement of cash flows
Notes to the financial statements
Directors' declaration
Independent Auditor's Report
Shareholders' information
Glossary of terms
Corporate directory
44
46
54
77
78
78
80
82
84
86
128
129
135
137
139
Steadfast Group Annual Report 2023 43
2023 Annual Report Directors’ Report
The Directors present their report together with the consolidated financial statements of Steadfast Group Limited (Steadfast or the
Company), its subsidiaries and interests in associates and joint ventures (collectively Steadfast Group or the Group) for the financial
year ended 30 June 2023 (FY23) and the Auditor’s Report thereon.
Directors
The Directors of the Company in office at any time during or since the end of the financial year are as follows:
Name
Chair
Frank O’Halloran, AM
Managing Director & CEO
Robert Kelly, AM
Other Directors
David Liddy, AM (Deputy Chair)
Vicki Allen
Joan Cleary
Gai McGrath
Greg Rynenberg
Former Director
Anne O'Driscoll1
Date of appointment
21 October 2012
18 April 1996
1 January 2013
18 March 2021
28 July 2022
1 June 2018
10 August 1998
1 July 2013
1 Anne O'Driscoll retired as a Non-Executive Director on 15 March 2023.
Directorships of other listed companies
Directorships of other listed companies held by the Directors in the three years preceding the end of the financial year are as follows:
Name
David Liddy, AM
Robert Kelly, AM
Vicki Allen
Gai McGrath
Company
EML Payments Limited
Johns Lyng Group Limited
Mortgage Choice Limited
Helia Group Limited
Period of directorship
April 2012 to February 2023
Since November 2017
June 2017 to July 2021
Since August 2016
Anne O’Driscoll
Infomedia Limited
December 2014 to March 2023
FINEOS Corporation Holdings Plc
Since July 2019
Particulars of the Directors’ experience are set out under Board of Directors on pages 20 to 21.
44 Steadfast Group Annual Report 2023
Directors' meetings
The number of Directors’ meetings (including meetings of committees of Directors) and number of meetings attended by each of
the Directors of the Company during the financial year were as follows:
Board
Audit & Risk
Nomination
Remuneration
& Performance
People, Culture
& Governance
Committee
Total number of
meetings held
10
Director1,2
H
A
H
Frank O’Halloran, AM
David Liddy, AM
Robert Kelly, AM
Vicki Allen
Joan Cleary
Gai McGrath
Anne O’Driscoll
Greg Rynenberg
10
10
10
10
9
10
9
10
10
9
10
10
9
10
8
10
-
3
-
1
4
-
3
4
1 H Number of meetings held while a Board or Committee member.
2 A Number of meetings attended while a Board or Committee member.
4
A
-
3
-
1
4
-
3
4
4
A
4
3
-
4
-
-
-
-
H
4
4
-
4
-
-
-
-
6
A
6
3
-
6
3
-
-
-
H
6
3
-
6
3
-
-
-
3
A
-
-
3
-
3
3
-
3
H
-
-
3
-
3
3
-
3
Details of the responsibilities of the members of the Board and the various committees are set out in the Corporate
Governance section in this report, and in the corporate governance section of the Steadfast investor website (http://
investor.steadfast.com.au/investor-centre/).
Principal activities
The principal activities of the Group during the financial year were the provision of services to Steadfast Network brokers, the
distribution of insurance policies via insurance brokerages and underwriting agencies, and related services.
Significant changes in the state of affairs
There were no significant changes in the state of affairs of the Group. The Group continued to acquire businesses during the
financial year. Refer Note 10.
Steadfast Group Annual Report 2023 45
Directors’ Report continued
Operating and financial review
A. Operating results for the financial year
The trading results for the financial year are summarised as follows (refer Note 4 and Note 5):
2023
$'m
2022
$'m
Underlying net profit after income tax (NPAT) attributable to owners of Steadfast Group Limited
207.0
169.0
Adjustments for non-trading items (net of tax and non-controlling interests):
Deferred consideration expense (where actual earnout was more than expected)
(17.8)
(18.0)
Deferred consideration income (where actual earnout was less than expected, excluding IBA)
Net adjustment relating to IBA acquisition (refer note 7F)
Impairment of non-IBA investments
Mark-to-market (losses)/gains from revaluation of listed investments
Net gain from change in value or sale of businesses and other movements
Statutory NPAT attributable to owners of Steadfast Group Limited
Underlying diluted earnings per share (EPS) (cents per share)
Statutory diluted EPS (cents per share)
1.4
0.5
(1.9)
(1.7)
1.7
189.2
20.2
18.4
5.5
-
(3.5)
1.6
17.0
171.6
17.6
17.9
The underlying NPAT was $207.0 million compared with $169.0 million in 30 June 2022. The increase was mainly due to:
organic growth including revenue growth from price increases by insurers as well as volume increases;
acquisition of Insurance Brands Australia (IBA) and interests in other Network brokers, including from the Trapped Capital
project; and
full period contribution from Coverforce and other businesses acquired in the financial year ended 30 June 2022 (FY22).
The underlying NPAT reflects the basis upon which performance is measured and monitored by the Board and management.
Underlying NPAT has been disclosed in accordance with ASIC’s Regulatory Guide RG230. The adjustments to profit have been
extracted from the audited books and records. Underlying NPAT is disclosed to provide a more meaningful analysis of the Group’s
financial results from normal operating activities.
B. Review of financial condition
I. Financial position
During the financial year net equity increased by $431.0 million, primarily due to a capital raise in August 2022 and the retention of
profits in excess of dividends paid. This capital raised, along with debt drawdowns, was deployed on acquisitions throughout the
year. As a result, goodwill increased by $515.3 million as detailed in Note 10 to the financial statements.
II. Cash from operations
Net cash inflows from operating activities of $318.2 million (excluding trust account and premium funding movements) reflected
continued full conversion of profits into cash flows. After funding dividends to shareholders, the remaining free cash flow is available
for corporate activities, including acquisitions of further business interests.
III. Capital management
At 30 June 2023, the Company had 1,038.6 million ordinary shares on issue, up from the 977.6 million ordinary shares on issue
at 30 June 2022, principally as a result of the institutional and retail share placement of 45.5 million shares ($233.4 million) in
August 2022 to fund acquisitions and 14.1 million shares ($72.8 million) issued to vendors of IBA and other businesses. Additionally,
1.4 million shares ($7.2 million) were issued under the September 2022 Dividend Reinvestment Plan (DRP). The Company continues
to acquire shares on market to provide for potential share issues to employees, including Key Management Personnel (KMP), under
equity-based incentive schemes.
46 Steadfast Group Annual Report 2023
The Group leverages its equity, adopting a maximum 30.0% total gearing ratio (excluding premium funding borrowings). At 30 June
2023, the Group’s gearing ratio was 19.0% (2022: 19.0%). Refer Note 9C.
At 30 June 2023, the Group had a $660.0 million multibank syndicated facility with a combination of three year and five year
tranches, allowing the Group to borrow a further $216.6 million from this facility. The facility was extended and increased to
$860.0 million subsequent to balance date.
At 30 June 2023, the Warehouse Trust limit for IQumulate Premium Funding Pty Ltd was $570.0 million (including a $60.0 million
overdraft facility). In July 2023, the Warehouse Trust limit was increased by $90.0 million to $660.0 million (including a $60.0 million
overdraft facility) with an extended availability period to July 2024. The premium funding borrowings, secured primarily by the
premium funding receivables, have a one-year term (renewed on an annual basis) to attract a lower cost of borrowing which is
standard commercial practice for this sector. Whilst the contractual availability period ends in July 2023, the premium funding
borrowings have been classified as non-current in the statement of financial position as the contractual maturity date includes
an amortisation period giving the Group 12 months to repay from the date of the last maturing premium funding loan in the
Warehouse Trust.
The corporate debt and premium funding facilities are not cross collateralised.
Strategy and prospects
The Group's business strategy is to maintain its position as the largest intermediated insurance distribution network in Australasia
by continuing to grow shareholder value through expansion of the Steadfast insurance distribution and risk management services
model and related businesses, including provision of these services to Steadfast’s international network.
Despite the backdrop of an uncertain economic environment, Steadfast Group has proven to be a stable and resilient business.
The Group aims to increase value for all shareholders by delivering excellence in insurance services to all stakeholders including
Network brokers, customers, strategic partners, employees and our community. The Group's strategic plan is a framework for
decision making and planning for the Group's development of the strategic objectives which include:
Maintaining and enhancing the premier service offering to Steadfast Network brokers
Realising the potential in our existing equity businesses to achieve strong organic growth and improve/maintain margins
Disciplined M&A strategy to drive focused execution of domestic/international opportunities
Developing cultural, organisational and leadership development solutions that enhance employee engagement and drive
business performance
Maintaining strong insurer partnerships and industry stakeholder relationships
Technology strategy focused on delivering growth on core platforms and improving overall governance including cyber
risk management
A. Steadfast Group
FY23 highlights
Underlying revenue growth of 24.1%
Underlying EPS growth of 14.6%
Dividend per share growth of 15.4%
Completed a number of earnings accretive investments for a total outlay of $574.2 million, with the largest acquisition being IBA
Steadfast Group grew underlying FY23 EBITA by 26.5% to $430.7 million. This result was driven by both organic growth of 13.6%
and acquisition growth of 12.9%.
As an industry leader, Steadfast continued to actively review and implement new legislation applicable to the sector. This included
engagement with industry peers and industry bodies on the conflicted remuneration and quality of advice issue. Steadfast has also
implemented customer centric solutions including the Steadfast Client Trading Platform (SCTP) and our Steadfast Broker Code of
Conduct framework to support transparency.
Medium-term
Steadfast has a strong corporate governance foundation, including risk management framework and culture, to enable sustainable
growth over the long term. This positions the business well to continue to improve operational efficiency through a culture of
excellence and talent, seeking opportunities to promote entrepreneurship and improve underlying margins.
Steadfast Group Annual Report 2023 47
Directors’ Report continued
B. Steadfast Broking
FY23 highlights
$11.6 billion Network GWP, up 12.8% on FY22
426 broker members in the Network, down from 427 in FY22 after numerous mergers and sales within the Network
Steadfast has an equity stake in 68 brokers, up from 67 in FY22 following several acquisitions made during the financial year and
a number of hubbings
Underlying EBITA up 27.7%
During FY23, growth in the Steadfast Broker Network was driven by organic growth and the acquisition of a number of Steadfast
Network brokers. Organic growth of 16.5% in underlying EBITA was primarily a result of strategic partners further increasing
insurance premiums. Acquisitions provided a further 11.2% increase in underlying EBITA.
Medium-term
Steadfast is well positioned to respond to the current market conditions and will continue to build resilience within the business
by focusing on proceeding with caution to implement management buy-ins, hubbing and co-owner opportunities when its strict
cultural, risk and financial acquisition guidelines are met. Steadfast Group has an equity holding in 48% of the GWP and 16% of the
number of brokers within the Steadfast Network, which provides potential future acquisition growth for the Group. The Trapped
Capital initiative continues to execute on this strategy. The Trapped Capital initiative provides Steadfast Network brokers the
opportunity to unlock trapped capital by partial or full sale to Steadfast.
C. Steadfast Underwriting Agencies
FY23 highlights
$2.1 billion GWP, up 16.7% on FY22
Steadfast has equity stakes in 29 agencies, up from 28 in FY22
Underlying EBITA up 15.7%
FY23 growth in Steadfast Underwriting Agencies is predominately organic growth, primarily driven by price and volume uplift.
Most agencies experienced strong growth during FY23, particularly in property and professional lines. The division’s excellent
performance was also due to the long-term strategy of closely aligning capacity providers, technology and a strong service ethic
with the agencies' niche product offerings.
By enhancing the partnerships between underwriting agencies and strategic insurer partners and working effectively together,
Steadfast Underwriting Agencies expanded its product range for the benefit of brokers and their clients. Development of actuarial
and data analytics capabilities have contributed significantly to improved portfolio management and performance reporting. This
will be a continued focus to ensure that we are managing our exposures and ultimately improving loss ratios.
Medium-term
Steadfast Underwriting Agencies is well positioned to maintain organic growth through a high retention of customers and new
business, as it aims to further improve customer service, and the expectation of further price increases coming from strategic
partners. Brokers truly value the differentiated service they receive from Steadfast Underwriting Agencies, and this has been a key
competitive advantage of the business.
Steadfast Underwriting Agencies' focus remains on seeking new opportunities with strategic partners to expand its product range,
as a number of insurers reposition their approach to distribution.
D. Steadfast Complementary Businesses
FY23 highlights
$1.2 billion GWP written through SCTP, up 24% on FY22
205 brokers live on INSIGHT (after merging of brokers) and over 6,000 INSIGHT users
The technology team continued the migration of Network brokers onto the Group's proprietary broking management system
(INSIGHT) and continued enhancing the offering on SCTP – increasing the number of strategic partners and product lines offered.
Steadfast continues to invest in further enhancements to the platform.
48 Steadfast Group Annual Report 2023
The Group continued to expand its complementary businesses with the further development of a range of risk management, claims
management and complementary offerings. The Group also acquired a minority stake in Flame Security International, a company
which develops fire protection products and technologies.
Medium-term
As an industry leader in innovation, Steadfast is well positioned to continue modernising its technology platforms to improve broker
and client experience and support growth. Steadfast remains focused on further enhancing SCTP by adding more product lines,
new insurers and auto-rating capabilities, driving increased SCTP usage and more transparent alternative pricing and coverage
for clients.
The Steadfast team will continue to support the migration of brokers onto the INSIGHT platform, with an additional 16
brokers committed to migrate and discussions ongoing with another 28 brokers. Focus will also remain on the development of
enhancements to the security and efficiency of INSIGHT, seeking to continue to provide Steadfast brokers and their clients with
a market leading, secure and efficient platform.
Steadfast Risk Group has established an array of complementary businesses which address major challenges of the Broker
Network which is trying to differentiate its services, and ultimately provide a more holistic solution around risk identification and
management. These services focus on risk identification, management, and control as well as valuations, claims and alternative risk
transfer solutions and extend to our insurer partners.
Principal risks and uncertainties
The principal risks and uncertainties outlined in this section reflect the risks that could materially affect Steadfast Group or its
ability to meet its strategic objectives, either directly or by triggering a succession of events that in aggregate become material to
the Group.
Set out below are the key risk categories used by Steadfast Group to manage risk, underpinned by a strong focus on risk culture.
The risks discussed should not be considered an exhaustive list of every possible risk associated with the Group.
Risk
Description
Managing the risk
Financial risk
The risk that the Group fails to
achieve its financial objectives as set
out within the Business Plan.
Impairment
risk
The risk that investments are subject
to a permanent decrease in value,
resulting in an expense for the Group.
We work with management of the businesses in which Steadfast is invested
to optimise sustainable results. Regular reviews of operating businesses are
undertaken and action plans to improve performance agreed and monitored
as appropriate.
We actively manage our liquidity and funding positions and ensure appropriate
contingency arrangements are maintained. We maintain a strong liquidity
position to preserve financial flexibility. Corporate gearing ratios, as agreed
with the Board, and borrowing covenants are closely monitored and reported.
We have a highly experienced mergers and acquisitions team that reviews the
performance of our investments on an ongoing basis, including agreeing
actions for improvement where appropriate. We have a due diligence
process to assess risk profile, with contractual representations and warranties.
Contingent consideration is used where appropriate to reduce uncertainty.
A formal impairment review is undertaken at least annually, or more frequently
if there are indications of impairment.
Strategic risk The risk associated with the pursuit
of the Group’s strategic objectives,
including the risk that the Group
fails to execute its chosen strategy
effectively or in a timely manner.
We consider and manage strategic risks through our annual strategic planning
process led by management and overseen by the Board. The Board monitors
management’s progress in implementing key strategic initiatives and any
change in our key strategic risks is managed in accordance with our risk
management framework.
Operational
risk
The risk of loss from inadequate
or failed internal processes,
people and/or systems, or from
external events.
Operational risk can arise in
many forms such as fraud or
errors by employees, and business
interruptions caused by external
parties (e.g. cyber attacks) or a
breakdown in key internal business
or system processes.
Steadfast manages operational risk through policies and procedures that
include relevant internal controls, including authorisation and reconciliation
procedures, effective segregation of duties and information security.
We have a risk management process which identifies, assesses, evaluates and
manages the key business risks. We also have a risk appetite statement, which
sets out the type and magnitude of risk that the Board is willing to accept in
order to achieve the organisation’s objectives. A risk appetite scorecard which
tracks performance against the risk appetite statement is presented to the
Audit and Risk Committee quarterly.
Steadfast Group Annual Report 2023 49
Directors’ Report continued
Risk
Description
Managing the risk
Our technology and information security strategy is underpinned by an
ongoing improvement program designed to support our infrastructure and a
strong cyber security posture.
Our approach to cyber security is constantly evolving in response to changes
in the threat landscape so that we can maintain system availability and
support ongoing business operations. Our dedicated technology teams
focus on migration, implementation, continued development and support
of our core platforms. We have a range of activities to continuously test
and assess the resilience and sustainability of our platforms, including
cyber awareness training, phishing simulation exercises, penetration tests,
vulnerability and patch management, and risk assessments. Business
continuity, disaster recovery and crisis management plans are in place, and
tested at least annually.
We have introduced additional cyber security controls to assess third-party
risk in our supply chain and vendor assessment process in response to an
increase globally in cyber attacks resulting from vulnerabilities in third-party
systems and applications.
We manage people risk through a combination of controls including:
succession & development planning;
employee engagement & experience surveys and feedback;
workforce planning;
regular monitoring of skills gaps;
KPI setting and performance reviews;
employee training; and
appropriate remuneration arrangements.
We have been actively engaged in addressing this risk, both within our
business and through stakeholder engagement. Activities undertaken include:
working with the National Insurance Brokers Association to identify and
assess the impact of changes, liaising with regulators as appropriate;
providing a range of services including professional development days
and town hall meetings to help Group entities understand and embed
regulatory change; and
implementing Steadfast's Broker Code of Conduct that supports the
principles of clients’ best interest.
Key features of how we manage compliance risk as part of our operational risk
framework include:
embedding key obligations into our operations;
identifying changes in regulations and the business environment to enable
us to proactively assess emerging compliance obligations;
implementing robust reporting and certification processes;
identifying, reporting and managing incidents/breaches in a timely manner;
monitoring compliance through an ongoing internal audit program; and
a whistleblower protection policy, encouraging employees and contractors
to raise concerns relating to accounting, internal control, compliance,
audit and other matters. Confidentiality is assured and anonymous
submissions allowed.
Steadfast manages counterparty/outsourcing risk through the
following activities:
a procurement process for selecting suppliers is performed by the relevant
business unit;
legal review of supplier contracts; and
monitoring of supplier performance by the relevant business unit.
Technology
& cyber
security risk
The risk of failure of critical
technology assets, infrastructure
and services and the risk of loss
from theft or unauthorised access to
systems including the compromise
of an IT asset’s confidentiality,
integrity or availability.
People risk
The risk associated with ineffective
recruitment, retention and
engagement of skilled/key personnel
or failure to appropriately manage
work health and safety. These
risks may affect Steadfast’s assets,
reputation, financial performance
and its ability to operate efficiently or
successfully execute its strategy.
Legal and
regulatory risk
The risk of loss arising from the
change in regulations and law that
might affect the industry in which
Steadfast operates.
Compliance
risk
The risk of failure to act in
accordance with laws, regulations,
industry standards and codes,
internal policies and procedures and
principles of good governance as
applicable to the Group’s businesses.
Counterparty/
outsourcing
risk
The risk arising from a service
provider’s failure to meet
their contractual obligations or
termination of material contracts.
50 Steadfast Group Annual Report 2023
Risk
Description
Managing the risk
Reputational
risk
The risk of loss that directly
or indirectly impacts earnings or
value that is caused by adverse
perceptions of the Group held by
brokers, customers, shareholders,
employees, regulators and the
broader community.
We manage reputation risk by maintaining a positive and dynamic culture that
emphasises the need to always act with integrity and which enables us to
build strong and trusted relationships with brokers, customers, shareholders,
employees, regulators and the broader community.
We have established decision-making frameworks and policies to ensure
our business decisions are guided by sound financial, social and
environmental standards.
We also have an active internal audit program to review each of the businesses
in which we have invested to assist in identifying potential reputational
exposures to the Group from individual business operations.
Climate risk
Being a services-based business with operations in local communities, Steadfast has a relatively small environmental footprint.
Nonetheless, we recognise that climate change continues to be a global risk and a material issue for the insurance industry, including
insurers, customers, and the whole economy.
As part of our Environmental, Social and Governance focus, we have committed to pursuing a reduction in the intensity of our
operating emissions (Scope 1 & 2), with a target for our Australian controlled businesses to be carbon neutral by 2030. Details about
how we plan to achieve this target are included in our Carbon Neutral Transition Plan, published in December 2022. We understand
that this plan needs to evolve and, as our capacity improves, we will include Scope 3 emissions.
Dividends
Details of dividends paid or declared by the Company are set out in Note 6 to the financial statements.
During FY23, a final dividend for FY22 of 7.8 cents per share and an interim dividend for FY23 of 6.0 cents per share were declared
and paid, both fully franked.
Events after the reporting period
Final dividend
On 16 August 2023, the Board declared a final dividend for FY23 of 9.0 cents per share, fully franked. The dividend will be paid on
21 September 2023.
Facility extension
At 30 June 2023, the Group had a $660.0 million multibank syndicated facility with a combination of three year and five year
tranches. The Group had the ability to borrow a further $216.6 million from this facility.
Subsequent to the balance date, these facilities were increased to $860.0 million and extended as follows:
two revolving tranches totalling $385.0 million, maturing August 2026;
two fixed-term tranches totalling $175.0 million, maturing August 2026;
a $200.0 million fixed-term tranche, maturing November 2026; and
a $100.0 million fixed-term tranche, maturing August 2028.
IQumulate Premium Funding Warehouse Trust extension
At 30 June 2023, the Warehouse Trust limit for IQumulate Premium Funding Pty Ltd was $570.0 million (including a $60.0 million
overdraft facility). In July 2023, the Warehouse Trust limit was increased by $90.0 million to $660.0 million (including a $60.0 million
overdraft facility) with an extended availability period to July 2024.
Likely developments
The Group’s strategy is to grow shareholder value through maintaining and growing its market position in the provision of insurance
and related services, with a core focus on general insurance intermediation. Details are provided in the strategy and prospects
section of the Directors’ Report.
The Group continues to work closely with the management team of each acquired business, and allows each business to operate
in a manner consistent with the Group’s co-ownership model. In most cases, this model involves ongoing equity participation of
key management in the business acquired.
Steadfast Group Annual Report 2023 51
Directors’ Report continued
The Board has provided the following FY24 guidance:
Underlying EBITA of $500.0 million to $510.0 million
Underlying NPAT of $230.0 million to $240.0 million
Underlying NPATA of $277.0 million to $287.0 million
Underlying diluted EPS (NPAT) growth of 10% to 15%
This is subject to the key risks set out on pages 49 to 51 and the following key assumptions:
insurers to continue to increase premium rates as anticipated;
completion of $280.0 million of the current pipeline of acquisitions; and
no material adverse impacts from current global uncertainties.
Environmental regulation
The Group’s operations are not subject to any particular significant environmental regulations under a law of the Commonwealth
or under State or Territory legislation.
Indemnification and insurance of officers
In accordance with its Constitution, and where permitted under relevant legislation or regulation, the Company indemnifies
the Directors and Officers against all liabilities to another person that may arise from their position as Directors or Officers
of the Company and its subsidiaries, except for conduct involving a lack of good faith and other matters set out in the
Company’s Constitution.
In accordance with the provisions of the Corporations Act 2001, the Company has insured the Directors and Officers against
liabilities incurred in their role as Directors and Officers of the Company. The terms of the insurance policy, including the premium,
are subject to confidentiality clauses and therefore the Company is prohibited from disclosing the nature of the liabilities covered
and the premium paid.
Non-audit services
During the financial year, KPMG, the Group’s auditor, performed certain other services in addition to their statutory duties.
The Board has considered the non-audit services provided by the auditor and is satisfied that the provision of those non-audit
services is compatible with, and did not compromise, the auditor independence requirements of the Corporations Act 2001 for the
following reasons:
all non-audit services engagements were subject to the corporate governance procedures adopted by the Group, and have been
reviewed by the Audit & Risk Committee to ensure they do not affect the integrity and objectivity of the auditor; and
the non-audit services provided do not undermine the general principles relating to auditor independence as set out in APES
110 Code of Ethics for Professional Accountants, as they did not involve reviewing or auditing the auditor’s own work, acting in a
management or decision-making capacity for the Group, acting as an advocate for the Group or jointly sharing risks and rewards.
Details of the amounts paid to the auditor of the Group, KPMG, and its network firms, for audit and non-audit services provided
during the financial year are provided in Note 22 to the financial statements.
Lead Auditor's Independence Declaration
The Lead Auditor’s Independence Declaration is set out on page 77 and forms part of the Directors’ Report for the financial year
ended 30 June 2023.
52 Steadfast Group Annual Report 2023
Steadfast Group Annual Report 2023 53
Steadfast Group’s remuneration framework links reward with the strategic goals and performance of the individual and the Group. Remuneration Report
Dear Shareholders,
On behalf of the Steadfast Group Board, I am pleased to present the Remuneration Report for the financial year ended 30 June
2023. The purpose of this report is to outline Steadfast Group’s approach to remuneration for Executives and Non-Executive
Directors and, in particular, the links between Steadfast Group’s remuneration framework and business strategy, performance and
reward. To continue to enhance the content and useability of our Remuneration Report, this year we have streamlined and refreshed
some of our reporting.
The objectives of Steadfast Group’s remuneration framework are to:
maintain market competitive remuneration that enables the Group to attract and retain key talent;
align remuneration to the Group’s strategic and business objectives and the creation of shareholder value;
be fair, transparent and easily understood by all stakeholders; and
be acceptable to shareholders and meet community expectations.
FY23 performance
During the past 12 months the Steadfast Group has continued to perform strongly and achieved record full year financial results, in
excess of initial guidance announced on 17 August 2022. We believe that the results achieved by the Steadfast Group reflect our
approach to implementing our strategies and plans, and the professionalism and dedication of our high quality Executive team.
The Group reported underlying earnings before interest, tax and amortisation (EBITA) of $430.7 million and underlying net profit
after tax (NPAT) of $207.0 million. This represents a 26.5% increase in underlying EBITA and a 22.5% increase in underlying NPAT over
the prior year. The Group’s underlying earnings per share (EPS) growth assessed for remuneration purposes was 14.6% and return
on capital (ROC) was 12.2%. for the financial year. The total shareholder return (TSR) since our listing has been 498%. In addition to
achievement of financial outcomes, the Board also assesses the Executives' demonstration of TOGETHER values.
Annual remuneration review
The Board regularly reviews the Steadfast Group’s Executive remuneration arrangements to ensure that our framework is
fit-for-purpose and continues to support the delivery of our core business objectives. We continue to receive positive support from
shareholders and other interested parties and, as a result, changes for FY24 are limited to a review of performance hurdles.
An independent benchmarking review of Non-Executive Directors' fees was undertaken in 2023 by the Godfrey Remuneration
Group (GRG). GRG recommended some increases to Non-Executive Director fees from FY24 and these changes are detailed in
the report.
I invite you to read our Remuneration Report and welcome any feedback on our remuneration framework to ensure it meets the
needs and expectations of shareholders, employees and other key stakeholders. I am personally available to discuss any aspects of
our remuneration framework with our shareholders at our upcoming Annual General Meeting.
Sincerely,
Vicki Allen
Chair, Remuneration & Performance Committee
54 Steadfast Group Annual Report 2023
1. Introduction
1.1. Remuneration framework
1.2. Remuneration governance
1.3. Key management personnel
2. Remuneration explained
2.1. STI for FY23 and FY24
2.2. LTI for FY23 and FY24
2.3. Maximum potential and actual STI and LTI outcomes
2.4. Link between Steadfast's performance and remuneration
2.5. Targeted maximum potential and actual remuneration mix for FY23
2.6. STI and LTI vesting information
2.7. Keeping Executives' and shareholders' interests aligned
2.8 Accounting treatment
3. Remuneration in detail
3.1. Statutory remuneration disclosure
3.2. Conditional rights
3.3. Executive service agreements
4. Non-Executive Director remuneration
4.1. Fee structure and policy
4.2. Minimum shareholding requirement
4.3. Remuneration details for Non-Executive Directors
5. Additional information
5.1. Use of remuneration consultant
5.2. Valuation of conditional rights
5.3. Shareholdings
5.4. Related party transactions
5.5. Hedging prohibition
56
56
57
58
59
59
61
63
64
68
69
69
69
70
70
71
71
72
72
73
73
74
74
74
75
75
75
Steadfast Group Annual Report 2023 55
2023 Remuneration Report Remuneration Report continued
1. Introduction
The Remuneration Report outlines Steadfast’s remuneration principles, framework and outcomes for FY23 for all key management
personnel (KMP), comprising all Non-Executive Directors and the Executive Team made up of the Managing Director & Chief
Executive Officer (MD & CEO) and certain direct reports. KMP are those persons having authority and responsibility for planning,
directing and controlling the activities of the Company, directly and indirectly.
1.1. Remuneration framework
The objective of the Group’s executive remuneration framework is to ensure reward for performance is competitive and appropriate
for the results delivered. The framework aligns executive reward with achievement of strategic objectives and the creation of
sustainable long-term value for shareholders and conforms to market practice for delivery of remuneration. The incentive schemes
are designed to incentivise performance that is better than market.
The Group’s remuneration structure aligns with ASX Corporate Governance Council Principles & Practice (4th edition).
The Group aims to reward Executives with a level of remuneration commensurate with their responsibilities and position within the
Group and their ability to influence shareholder value creation. The incentive schemes are designed to encourage participants to
strive to ensure Steadfast outperforms the market on an ongoing basis. Refer to table 2.4 for EPS growth of the Group over a five
year period.
The remuneration framework links reward with the strategic goals and performance of the individual and the Group and provides
a market competitive mix of both fixed and variable rewards. Key Performance Indicators (KPIs), together with weightings, are
established for each individual which are aligned to the Group’s strategic objectives.
The key elements of executive remuneration are:
fixed remuneration consisting of cash salary, superannuation and non-monetary benefits;
an annual short-term incentive (STI) plan (Section 2.1); and
a long-term incentive (LTI) plan (Section 2.2).
Refer to Section 2.5 for targeted maximum remuneration mix.
Remuneration principles
The remuneration framework embodies these remuneration principles:
Principle
Competitive
Alignment
Fair
Strategic
Culture
Transparent
Purpose
Retain and attract talent
Creation of shareholder value over time
Fair for all stakeholders
Delivery of strategic plans within risk appetite
Meet TOGETHER values
Able to be understood by all stakeholders
56 Steadfast Group Annual Report 2023
Remuneration structure
Purpose
Composition
Performance
measures
Fixed pay
Short-term incentive
Long-term incentive
Attract and retain talent
Reflects individual roles and experience, based on
comparative remuneration in the market and total
organisation salary budget
Reward achievement of
personal and Group goals
over a 12 month period
Reward creation of longer-
term shareholder value
Fixed remuneration (cash salary, superannuation,
and non-monetary benefits like car parking)
Fixed remuneration targeted at 25%-40% of total
remuneration, depending on the role
STI opportunity
comprising cash
and deferred equity
award (DEA)
Competitive benchmarking
Return on capital (ROC)
LTI opportunity
comprising DEA
Earnings per share
(EPS); and
Total shareholder
return (TSR)
1.2. Remuneration governance
This report meets the remuneration reporting requirements of the Corporations Act 2001 and Accounting Standard AASB 124
Related Party Disclosures. The term remuneration used in this report has the same meaning as compensation as prescribed in
AASB 124.
Role of the Remuneration & Performance Committee
The Remuneration & Performance Committee of the Board is responsible for reviewing and recommending to the Board
remuneration arrangements for the Non-Executive Directors and the Executive Team made up of the MD & CEO and his direct
reports listed in the KMP table in Section 1.3.
The Board and committee structure is outlined below:
Steadfast Group Annual Report 2023 57
Remuneration Report continued
1.3. Key management personnel
The KMP of the Group for the entire financial year, unless otherwise stated, are as follows:
Name
Role
Date of appointment
Non-Executive Directors
Frank O’Halloran, AM
Chair, Non-Executive Director
David Liddy, AM
Deputy Chair, Non-Executive Director
Vicki Allen
Joan Cleary
Gai McGrath
Greg Rynenberg
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Former Non-Executive Directors
21 October 2012
1 January 2013
18 March 2021
28 July 2022
1 June 2018
10 August 1998
Anne O'Driscoll1
Non-Executive Director
1 July 2013
Executive Director
Robert Kelly, AM
Other key management personnel
Nigel Fitzgerald
Samantha Hollman
Stephen Humphrys
Allan Reynolds
Managing Director & CEO
18 April 1996
Chief Operating Officer
Chief Executive Officer – International
Chief Financial Officer
4 April 2023
4 January 2000
2 January 2013
Executive General Manager – Direct, New Zealand & Asia
5 December 2002
1 Anne O'Driscoll retired as a Non-Executive Director on 15 March 2023.
58 Steadfast Group Annual Report 2023
2. Remuneration explained
2.1. STI for FY23 and FY24
The table below outlines the key details of the STI plan.
Component
Details
Purpose and link to strategy Rewards the achievements of the Group's business plan and individual goals over a 12 month period.
Operation
STI plan consisting of cash and DEA.
Potential reward
STI awards are performance-based, at-risk reward arrangements subject to Board discretion .
The total of at-risk remuneration for STI is targeted at 35%-55% of total remuneration, depending on
the role.
Performance measures
Non-financial measures:
The Board sets the individual objectives for the MD & CEO. The members of the Executive Team must
meet expectation or better in annual KPIs and TOGETHER values assessment to be eligible for any STI.
The MD & CEO achieved a substantial majority of his FY23 non-financial objectives with weightings
(refer Section 2.3).
Financial measures relating to awards issued during FY23:
ROC being underlying NPAT divided by opening equity attributable to owners of Steadfast Group
Limited, is the key metric upon which the STI is calculated.
The MD & CEO can earn an STI up to 200% of his annual fixed remuneration.
The other members of the Executive Team can earn up to 100% of their annual fixed remuneration;
however, they are not eligible for outperformance incentives.
Potential maximum STI
(including outperformance)
Approval of the STI
The MD & CEO’s STI is recommended by the Remuneration & Performance Committee based on the
Group’s financial and his non-financial performance outcomes and approved by the Board.
The STI of other members of the Executive Team is recommended by the MD & CEO to the
Remuneration & Performance Committee, based on the Group’s financial and their non-financial
performance outcomes. It is recommended by the Remuneration & Performance Committee and
approved by the Board.
Rationale for choosing
performance measures
The non-financial measures are chosen to ensure each member of the Executive Team delivers
outcomes that support the success of Steadfast.
Forms of the STI
reward elements
The financial measure of ROC is chosen to ensure long-term shareholder value is increased.
60% is paid as cash, normally in September following the end of financial year.
40% is granted as a DEA of conditional rights (rights) to Steadfast ordinary shares which vest over a
one-year tenure performance hurdle from the grant date.
Key terms of DEA
A DEA is normally granted on the date the audited financial results are announced. These rights are
granted to the participants at no cost.
The number of rights granted is calculated by dividing the dollar value of the DEA award by the volume
weighted average price (VWAP) of shares over the five trading days before the grant date.
The participants in the STI plan become eligible to receive one Steadfast ordinary share per right,
subject to their continuing employment with the Group over the vesting period post grant date, and no
material adverse change to the reported results. The Remuneration & Performance Committee noted
there had not been any material subsequent deterioration in reported results due to any prior year
adjustments for the year of the grant.
These rights will accrue notional dividends and may accrue, subject to Board discretion, any bonus
element inherent in any rights issue, which will be paid as additional shares upon vesting.
Forfeiture conditions
The Board retains the discretion to adjust any unpaid or unvested performance-related remuneration
(such as STI – cash, STI – DEA) downwards if it is appropriate to do so. Malus provisions also apply.
The rights will be forfeited if the Executive resigns before the vesting date.
When an Executive ceases employment as a "good leaver", such as genuine retirement, death,
redundancy or ill health, any unvested rights may be paid in cash and/or Steadfast ordinary shares,
subject to Board discretion.
Steadfast Group Annual Report 2023 59
Remuneration Report continued
Component
Details
Change of control
The rights vest upon a change of control event.
Vesting conditions
Continued employment to date of vesting, being one year from the grant date.
No material adverse change to the FY23 result (resulting in a material overstatement of NPAT for
that year).
The DEA component of the STI award vests one year from grant date. 30% of the amount calculated will be awarded only if there
has been achievement of both the financial target as well as strategic and individual personal goals. 70% of STI is calculated with
reference to the ROC hurdles set out in the table below. The hurdles are calculated with reference to the shareholders' equity at
the start of the financial year and, in the current financial year, underlying NPAT used in the calculation of ROC excludes the IBA
acquisition completed in the financial year.
Financial year ended 30 June 2023
Financial year ending 30 June 2024
Return on capital
Award outcome
Return on capital
Award outcome
Below 11.35%
0%
Below 11.55%
0%
11.35% to 11.75%
50% vesting to maximum
award on a straight line basis
11.55% to 11.95%
50% vesting to maximum
award on a straight line basis
11.75%
Maximum award
11.95%
Maximum award
11.75% to 12.25%
Outperformance award on a
straight line basis
11.95% to 12.45%
Outperformance award on a
straight line basis
The maximum outperformance amount will be calculated as a percentage of fixed pay as follows:
KMP
Outperformance award
KMP
Outperformance award
Robert Kelly, AM
50%
Robert Kelly, AM
50%
60 Steadfast Group Annual Report 2023
2.2. LTI for FY23 and FY24
The table below outlines the key details of the LTI plan.
Component
Details
Purpose and link
to strategy
Provides opportunity for the Executive Team to acquire equity in the Company as a reward for increasing EPS
and TSR over the longer term and helps to attract and retain talent.
Operation
LTI plan consisting of DEA.
Potential reward
LTI awards are discretionary, performance-based, at-risk reward arrangements.
Future
performance hurdle
At-risk remuneration for LTI is targeted at 20%-35% of total remuneration, depending on the role.
Non-financial measures:
The members of the Executive Team must meet expectation or better in annual KPIs and TOGETHER values
assessment to be eligible to receive any LTI. The MD & CEO achieved a substanial majority of his FY23
non-financial objectives with weightings (refer Section 2.3).
Financial measures relating to awards issued during FY23:
50% is based on average underlying diluted EPS growth, and the remaining 50% is based on TSR.
Potential maximum LTI The MD & CEO and CFO can earn up to 100% of their annual fixed remuneration.
The other members of the Executive Team can earn 75% to 100% of their annual fixed remuneration.
Approval of the LTI
The Board approves the LTI based on the financial and non-financial performance outcomes as
recommended by the Remuneration & Performance Committee.
Forms of LTI reward
DEA of rights to Steadfast ordinary shares which vest after the achievement of three-year future performance
and tenure hurdles.
Rationale for choosing
performance measures
The financial measures of EPS growth and TSR are chosen to ensure long-term shareholder value is increased.
The non-financial measures are chosen to ensure each member of the Executive Team delivers outcomes
that support the success of Steadfast.
Key terms of DEA
DEA is normally granted on the date the audited financial results are announced. These rights are granted to
the participants at no cost.
The number of rights granted is calculated by dividing the dollar value of the DEA award by the VWAP of shares
over the five trading days before the grant date.
The participants in the LTI plan become eligible to receive one Steadfast ordinary share per right, subject
to their continuing employment with the Group for the three-year period from the grant date and meeting
performance hurdles, subject to Board discretion.
These rights will not accrue notional dividends and may accrue, subject to Board discretion, any bonus
element inherent in any rights issue, which will be paid as additional shares upon vesting.
Forfeiture conditions
The Board retains the discretion to adjust any unpaid or unvested LTI downwards if it is appropriate to do so.
Malus provisions also apply.
The rights will be forfeited if the Executive resigns before the vesting date.
When an Executive ceases employment as a "good leaver", such as genuine retirement, death, redundancy or
ill health, any unvested rights may be paid in cash and/or Steadfast shares subject to Board discretion.
Change of control
The rights will vest upon change of control; however, the Board has discretion for them to immediately vest
or to vest over the vesting period.
Vesting conditions
Continued employment to date of vesting, being three years from the grant date.
50% based on average underlying diluted EPS increasing by a straight line 8% to 11% per annum over a
three-year vesting period; resulting in vesting of 25-100% on a straight line basis.
50% based on minimum TSR measured against 50th to 75th percentile of the peer group.
No material adverse change to the FY23 result (resulting in a material overstatement of EPS or TSR for
that year).
Steadfast Group Annual Report 2023 61
Remuneration Report continued
Key financial metrics for the calculation of LTI are detailed in the below table.
Financial year ending 30 June 2023
Financial year ending 30 June 2024
Straight line underlying
diluted EPS growth
Vesting outcome
Straight line underlying
diluted EPS growth
Vesting outcome
Below 8.0%
At 8.0%
8.0% to 11.0%
0%
25%
Straight line between 25%
to 100%
Below 10.0%
At 10.0%
10.0% to 13.0%
0%
25%
Straight line between 25%
to 100%
11.0% or higher
100%
13.0% or higher
100%
50% based on TSR measured against Top 200 ASX companies excluding those in the mining industry (peer group).
TSR
TSR
Equal to or less than 50th
percentile of peer group
0%
Equal to or less than 50th
percentile of peer group
0%
Greater than 50th but less than
75th percentile of peer group
Straight line between 25%
to 100%
Greater than 50th but less than
75th percentile of peer group
Straight line between 25%
to 100%
Equal to or exceeding 75th
percentile of peer group
100%
Equal to or exceeding 75th
percentile of peer group
100%
All LTIs granted in August 2019 (vested August 2022) were awarded and vested using underlying diluted EPS growth inclusive of any
mark-to-market adjustment in Johns Lyng Group; however, for LTIs granted in August 2020 (vesting August 2023), August 2021
(vesting August 2024) and August 2022 (vesting August 2025), they will be awarded and vested based on underlying diluted EPS
growth exclusive of any mark-to-market adjustments in listed investments.
62 Steadfast Group Annual Report 2023
2.3. Maximum potential and actual STI and LTI outcomes
The table below provides details of maximum potential STI and LTI, and actual STI and LTI awarded to KMP. The MD and CEO
measures the Executive Team's performance and recommends an outcome to the Remuneration & Performance Committee. All
KMPs achieved their non-financial and vast majority of financial performance measures and TOGETHER values hurdle assessment.
Maximum
STI
potential(c)
(% of fixed
pay)
Actual STI
outcome(a)
(% of fixed
pay)
STI – cash
out-
come
(60% of
outcome)
$
Fixed pay
$
STI – DEA
outcome(b)
(40% of
outcome)
$
Maximum
LTI
potential
(% of fixed
pay)
Actual LTI
outcome(a)
(% of fixed
pay)
LTI – DEA
outcome(b)
$
Robert Kelly, AM
1,242,000
200%
192%
1,433,131
955,421
Nigel Fitzgerald(d)
Samantha Hollman
Stephen Humphrys
Allan Reynolds
Table notes
231,875
565,000
750,000
510,000
100%
100%
100%
100%
100%
185,500
123,667
100%
339,000
226,000
100%
450,000
300,000
100%
306,000
204,000
100%
100%
100%
100%
75%
100% 1,242,000
100%
309,167
100%
565,000
100%
750,000
75%
382,500
a. All participants in the FY23 STI and LTI plans exceeded the non-financial performance hurdle and were awarded all of the 30% of
STI pertaining to achieving strategic and individual personal goals.
b. The number of rights granted is determined by the dollar value of the DEA outcome divided by the VWAP of shares over the five
trading days prior to the date of this report. The LTI award outcome is subject to the achievement of future financial performance
hurdles detailed in Section 2.2.
c. Maximum STI potential for Robert Kelly includes the outperformance potential.
d. Nigel Fitzgerald started as a KMP on 4 April 2023. Amounts disclosed reflect his time as KMP.
The MD & CEO’s performance against his annual KPIs set at the beginning of FY23 is set out below. Achievement of TOGETHER
values assessment hurdles is required to be eligible for participation in the plans:
FY23 performance measures
Weighting %
Achieved % Comments
Achievement of FY23 plan and budget
25%
25%
FY23 plan and budget exceeded. ROC is
12.17%, satisfying 100% of maximum and
84% of outperformance STI requirement.
Successful integration of IBA acquisition including
achieving minimum FY23 EBITA of $19.4 million
Successful completion of Trapped Capital
acquisitions with annualised EBITA of $26.1m
(excluding IBA)
Development of plan for cost saving initiatives to
improve EBITA margins in FY24
Implementation of plans for UnisonSteadfast
Hiring of a new Group COO with appropriate
delegation of responsibilities
Follow up TOGETHER results for key executives in
Group Head Office
Continue development of key executives
15%
15%
10%
5%
10%
10%
15%
IBA integration completed.
15%
Achieved
7.5%
Cost saving plan initiated.
2.5%
UnisonSteadfast strategy approved
by board.
10%
New Group COO hired.
8%
Achieved
10%
100%
7%
90%
Achieved
Steadfast Group Annual Report 2023 63
Remuneration Report continued
2.4. Link between Steadfast's performance and remuneration
A. Reconciliation of underlying NPAT and EPS
The reconciliation of reported NPAT to underlying NPAT used to calculate EPS for STI and LTI is as follows:
Reported NPAT attributable to owners of the Company
Less: non-trading income
Add: non-trading expenses
Less: non-trading tax effect
Less: non-controlling interests in non-trading items (net of tax)
Underlying NPAT attributable to owners of the Company
Less: adjustments for executive incentives
Underlying NPAT attributable to owners of the Company for
executive incentives
Adjusted underlying diluted EPS (cents per share) for
executive incentives
Growth from prior financial year (%)
Growth required for minimum STI (%)
Growth required for maximum STI (%)
Growth required for maximum outperformance STI (%)
ROC required for minimum STI (%)
ROC required for maximum STI (%)
ROC required for maximum outperformance STI (%)
Opening equity4
Underlying net profit attributable to owners of the Company for
calculating ROC4
ROC for calculating executive incentives4
Opening share price ($)
Closing share price ($)
Change in share price (cents per share)
Dividend declared per share (cents per share)
TSR for the financial year (cents per share)
TSR for the financial year (%)
Dividends paid for the financial year ($'m)
2019
$'m
103.8
(15.0)
-
0.1
0.3
89.2
-
2020
$'m
(55.2)
(18.0)
190.9
(10.9)
5.1
111.9
(5.4)
2021
$'m
143.0
(24.2)
5.3
5.1
1.5
130.7
(4.0)1
2022
$'m
171.6
(9.1)
3.9
1.5
1.1
2023
$'m
189.2
(24.1)
24.1
17.0
0.8
169.0
207.0
-
-
89.2
106.5
126.7
169.0
207.0
11.27
16.1%
5.0%
10.0%
N/A
N/A
N/A
N/A
N/A
N/A
N/A
2.81
3.51
70.0
8.5
78.5
27.9%
62.6
14.63
17.58
20.15
15.2%2
16.5%3
14.6%
7.5%
12.5%
15.0%
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
12.20%
11.35%
12.40%
11.75%
12.70%
12.25%
1,120.1
1,158.9
1,684.5
130.7
153.0
205.1
11.70%
13.20%
12.17%
12.70
10.5%
5.0%
10.0%
N/A
N/A
N/A
N/A
N/A
N/A
N/A
3.51
3.36
3.36
4.40
(15.0)
104.0
9.6
(5.4)
11.4
115.4
4.40
5.02
62.0
13.0
75.0
5.02
6.00
98.0
15.0
113.0
(1.5%)
34.3%
17.0%
22.5%
73.1
90.0
111.8
138.6
1 This includes the impact of Jobkeeper ($1.5m) which has been deducted from FY21 earnings to calculate executive incentives.
2 The FY20 base EPS for assessing FY21 incentives and for future periods is 12.70 cents per share.
3 The FY21 base EPS for assessing FY22 incentivies was 15.09 cents per share.
4In August 2021 and August 2022, the Company raised capital to acquire Coverforce and IBA respectively. The capital raised and the profits in the first year of acquisition
of these investees were removed from the ROC calculations to ensure that incentives were not biased by these acquisitions.
64 Steadfast Group Annual Report 2023
B. Return on capital
The graph below shows the base, minimum, maximum and actual ROC used for determining STI for FY23.
Return on capital (underlying NPAT divided by opening equity attributable to owners of Steadfast Group Limited)
11.7%
10.6%
13.2%
12.2%
10.4%
8.5%
8.8%
15
10
5
0
FY18
FY19
FY20
FY21
FY22¹
FY22 (pro-forma)
FY23²
1 Excludes Coverforce.
2 Excludes IBA.
The pro-forma FY22 result shown above adjusts the FY22 ROC calculations to show the actual impact of the acquisition of
Coverforce for the year together with the capital raised to fund that acquisition. This provides the appropriate "like for like" base upon
which the FY23 ROC performance can be measured.
Outcome
The STI awarded in August 2023 is determined against the hurdles set out in the table below:
ROC hurdle
ROC (%)
FY23 ROC to acheive minimum STI
11.35
FY23 ROC to achieve maximum STI
11.75
FY23 ROC to achieve maximum STI
with outperformance
Actual FY23 ROC
Outcome
12.25
12.17
The ROC in FY23 was 12.17%, meaning maximum STI was awarded and 84% of the
outperformance STI was awarded.
Steadfast Group Annual Report 2023 65
Remuneration Report continued
C. Underlying diluted EPS
The graph below shows actual underlying diluted EPS used for determining LTI for FY13 through to FY23. The underlying diluted EPS
for the prior financial year is the base used for calculating growth for the following financial year.
The underlying diluted EPS growth accounts for 50% weighting on LTI awards (FY22: 50%), which is not payable unless at least 8.0%
(FY22: 7.5%) straight line growth is achieved over the three-year vesting period.
Underlying diluted EPS for incentives (cents per share)
20.15
17.58
14.63
12.70
11.27
9.71
8.87
8.09
7.24
6.22
25
20
15
10
5
0
FY14
FY15
FY16
FY17
FY18
FY19
FY20²
FY21²
FY22
FY23
1 FY13 data is based on pro-forma financial information as if the Group operations, which listed in August 2013, had operated as the Group for FY13.
2 The base EPS for assessing FY21 incentives and for future periods was 12.70 cents per share. To calculate FY20 incentives, 12.45 cents per share was utilised.
Outcome
The underlying diluted EPS growth accounts for 50% weighting on LTI awards (FY22: 50%), which is not payable unless at least
8.0% (FY22: 7.5%) straight line growth is achieved over the three-year vesting period. 75% of the LTI that will vest in August 2023 is
referenced against the three year EPS performance since FY20. The below table outlines the requirements and outcome in relation
to EPS growth:
EPS hurdle
FY20 Base EPS
FY23 EPS to achieve minimum LTI
FY23 EPS to achieve maximum LTI
Actual FY23 EPS
Outcome
66 Steadfast Group Annual Report 2023
EPS (cents per share)
12.70
14.61
16.51
20.15
The straight line growth between FY20 and FY23 was 19.6% per annum, exceeding the required
growth of 10% per annum. Therefore maximum EPS LTI was awarded.
D. Total shareholder return
TSR is calculated as the change in share price plus dividends declared and any capital returns measured over the financial year. The
graph below shows the Company’s cumulative TSR since FY20, compared against the median TSR of top 200 ASX listed companies
excluding those in the mining industry (peer group).
Total shareholder return for incentives (%)
125
100
75
50
25
0
u 50th percentile (%)
u 75th percentile (%)
u Actual (%)
Outcome
35.1
22.5
95.4
Peer Group TSR
Steadfast TSR
TSR accounts for 50% of the LTI award, which is not payable unless equal to or above the 50th percentile of the peer group is achieved
over the three-year vesting period. Maximum award occurs if TSR is at or above the 75th percentile of the peer group. 25% of the LTI
that will vest in August 2023 is determined with reference to the three year TSR performance since FY20. The below table outlines
the requirements and outcome in relation to TSR:
TSR hurdle
TSR percentile (%)
FY20-FY23 TSR to achieve minimum LTI
50th percentile (22.5%)
FY20-FY23 TSR to achieve maximum LTI
75th percentile (57.6%)
Actual FY20-FY23 TSR
Top Quartile
Outcome
The TSR over the three years since FY20 exceeded the maximum LTI benchmark.
Therefore the maximum TSR LTI was awarded.
Steadfast Group Annual Report 2023 67
Remuneration Report continued
2.5. Targeted maximum potential and actual remuneration mix for FY23
Robert Kelly, AM targeted maximum
Actual
Nigel Fitzgerald targeted maximum
Actual
25%25%
26%26%
27%27%
27%27%
34%34%
34%34%
34%34%
34%34%
36%36%
36%36%
Samantha Hollman targeted maximum
Actual
Stephen Humphrys targeted maximum
Actual
Allan Reynolds targeted maximum
Actual
u Fixed remuneration
u At risk – STI cash
u At risk – STI deferred
u At risk – LTI
30%30%
29%29%
22%22%
22%22%
20%20%
20%20%
20%20%
20%20%
20%20%
20%20%
25%25%
25%25%
15%15%
15%15%
13%13%
13%13%
13%13%
13%13%
36%36%
36%36%
33%33%
33%33%
33%33%
33%33%
22%22%
22%22%
15%15%
15%15%
27%27%
27%27%
0
20
40
60
80
100
68 Steadfast Group Annual Report 2023
2.6. STI and LTI vesting information
The current vesting schedule for the DEA of rights to convert to Steadfast ordinary shares during the financial year or granted since is
set out below, subject at all times to the vesting conditions being met (refer Section 5.2 for the vesting date of the STI and LTI rights):
August 2022
August 2023
August 2024
August 2025
August 2026
Vesting date
DEA awarded
August 2019
August 2020
August 2021
August 2022
August 2023
STI
LTI
STI
LTI
STI
LTI
STI
LTI
STI
LTI
Vesting occurs in three equal tranches after one, two, and three years from grant date
Vesting occurs three years after grant date
Vesting occurs one year from grant date
Details of the Steadfast ordinary shares transferred to the relevant Executive Team members (at nil cost to them) for the DEAs that
vested during the current financial year are set out in Section 5.3.
2.7. Keeping Executives' and shareholders' interests aligned
The Executive Team holds Steadfast's ordinary shares, which helps align Executives' and shareholders' interests. The below table
details how Executives have acquired Steadfast's ordinary shares:
Component
Details
Executive
shareholdings
The Executive Team has acquired Steadfast’s ordinary shares through the following means:
shares allocated at IPO to three Executives either directly or through loans, which have since been repaid by
the Executives;
subscription for ordinary shares as part of the Company’s IPO and subsequent rights issues;
participation in the Company’s DRP;
rights converting into ordinary shares;
potential vesting of DEAs granted through the STI and LTI plans from FY14 onwards (refer Sections 2.1 and 2.2 for
further details of the STI and LTI plans); and
purchase of shares on market within trading windows.
2.8 Accounting treatment
The fair value of each DEA is recognised over the service period ending on the vesting date.
Steadfast Group Annual Report 2023 69
Remuneration Report continued
3. Remuneration in detail
3.1. Statutory remuneration disclosure
The table below provides remuneration details for KMP.
Short-term employment
benefits
Post-
employ-
ment
benefits
Other
long-term
employ-
ment
benefits
Subtotal
(excluding
share-
based
payments)
(1)
(2)
(3)
(4)
(5)
Cash salary
and leave
accruals
$
Non-
monetary
benefits
$
Super-
annuation
$
Cash STI
$
Long
service
leave
accruals
$
Share-based
payments
(6)
Total
$
$
$
Robert Kelly, AM, Managing Director & CEO
2023
2022
1,229,940
1,433,131
127,398
25,292
41,030
2,856,791
2,352,000
5,208,791
1,171,529
1,386,000
90,161
23,568
30,894
2,702,152
2,079,000
4,781,152
Nigel Fitzgerald, Chief Operating Officer(7)
2023
2022
241,979
185,500
4,658
6,323
3,608
442,068
567,000 1,009,068
-
-
-
-
-
-
-
-
Samantha Hollman, Chief Executive Officer – International
2023
2022
540,891
339,000
37,600
25,292
13,511
956,294
676,000
1,632,294
525,392
393,750
20,181
23,568
10,699
973,590
656,250
1,629,840
Stephen Humphrys, Chief Financial Officer
2023
2022
769,760
450,000
58,530
25,292
30,860
1,334,442
958,000 2,292,442
677,051
472,500
30,882
23,568
14,100
1,218,101
945,000
2,163,101
Allan Reynolds, Executive General Manager – Direct, New Zealand & Singapore
2023
2022
Table notes
456,608
306,000
22,105
25,292
15,684
825,689
577,000
1,402,689
480,295
291,000
10,848
23,568
14,861
820,572
557,750
1,378,322
1. Cash salary includes amounts paid in cash plus any salary sacrifice items. Annual leave accruals are determined in accordance
with Accounting Standard AASB 119 Employee Benefits.
2. The 2023 STI represents 60% of the total STI awarded and approved by the Board and will be paid in cash in September 2023.
3. KMP are provided with non-monetary benefits such as car parking, income protection and life insurances.
4. Superannuation contributions are paid in line with legislative requirements.
5. Long service leave accruals are determined in accordance with AASB 119 Employee Benefits.
6. Share-based payments reflect the expense accrued in the financial year for DEA (both STI and LTI). The 2023 expense is higher
than prior year due to the cumulative effect of prior year grants plus increased probability of meeting vesting conditions.
7. Nigel Fitzgerald commenced as Chief Operating Officer on 4 April 2023.
70 Steadfast Group Annual Report 2023
3.2. Conditional rights
The table below provides the number of rights held by KMPs as at 30 June 2022 and 30 June 2023. These are aggregate holdings
of unvested DEAs from the various grants that remain on foot (see chart in section 2.6).
Balance
30 June
2022
STI granted
during FY23
LTI granted
during FY23
Dividends
reinvested
Sign on
bonus DEA
granted
during FY23
STI/LTI
vested
during FY231
Balance
30 June
2023
Robert Kelly, AM
Nigel Fitzgerald2
Samantha Hollman
Stephen Humphrys
Allan Reynolds
1,225,003
171,543
214,429
9,443
-
(482,653)
1,137,765
-
-
-
-
400,000
-
400,000
366,770
48,734
73,101
554,685
58,480
116,961
309,933
36,016
67,531
2,715
3,258
1,978
-
-
-
(123,502)
367,818
(188,069)
545,315
(97,451)
318,007
1 The third tranche of the STI DEAs granted in August 2019, the second tranche of the STI DEAs granted in August 2020, the first tranche of the STI DEAs granted in August
2021 and the LTI DEAs granted in August 2019 vested in the current financial year. In accordance with the terms of the STI and LTI plans, eligible participants of the plans
received one Steadfast ordinary share per conditional right at nil cost to them upon vesting.
2 Nigel Fitzgerald commenced as KMP on 4 April 2023. The sign on bonus will vest in equal tranches in March 2024, 2025 and 2026, subject to continued tenure.
Refer Section 5.2 for the fair value of the rights awarded in August 2022.
3.3. Executive service agreements
Steadfast has ongoing executive service agreements with each KMP. These agreements may be terminated by written notice from
either party or by the Company making a payment in lieu of notice.
The agreements outline the components of remuneration paid to executives and require the remuneration of Executives to be
reviewed annually. The agreements do not require the Company to increase base salary, pay a short-term incentive or offer a
long-term incentive in any given year.
The table below contains the key terms of the agreements. The agreements do not provide for any termination payments, other
than payment in lieu of notice by the Company.
Name
Robert Kelly, AM
Nigel Fitzgerald
Samantha Hollman
Stephen Humphrys
Allan Reynolds
Notice period from
the Company
Notice period from
the employee
Termination provisions in relation to
payment in lieu of notice
12 months
12 months
6 months
6 months
6 months
12 months
12 months
6 months
6 months
6 months
12 months fixed remuneration
12 months fixed remuneration
6 months fixed remuneration
6 months fixed remuneration
6 months fixed remuneration
In accordance with the requirements of the Corporations Act 2001, termination provisions include the payment of unused annual
leave and long service leave accruals where applicable.
3.3.1. Retrenchment entitlements
In the event of redundancy, death or ill health, Mr Kelly will be paid an amount equal to 12 months fixed remuneration.
3.3.2. Termination under other situations
In the event of gross negligence or gross misconduct, the Company may terminate the executive agreement immediately by notice
in writing and without payment in lieu of notice.
Steadfast Group Annual Report 2023 71
Remuneration Report continued
4. Non-Executive Director remuneration
4.1. Fee structure and policy
Non-Executive Directors’ fees are determined within an aggregate fee pool, which is reviewed periodically and recommended for
approval by shareholders.
The fee structure is designed to provide the Group with the ability to attract and retain Directors of the highest calibre.
The aggregate amount of remuneration sought to be approved by shareholders and the manner in which it is paid to Directors
is reviewed annually. The Board considers advice from external consultants as well as fees paid to Non-Executive Directors of
comparable companies when undertaking the review process.
Independent and non-independent Non-Executive Director remuneration consists of three elements:
Board fees;
committee fees; and
superannuation, which is paid in line with legislative requirements.
Directors do not receive retirement benefits beyond superannuation contributions and do not participate in any incentive programs.
Directors may also be reimbursed for travel and other expenses incurred in attending to the Company’s affairs.
At the Annual General Meeting held on 22 October 2021, the shareholders approved the maximum aggregate Directors’ fee pool
of $2,000,000 per annum for each financial year effective from and including the financial year commencing 1 July 2021.
The remuneration for the Steadfast Board and committees was determined and paid in accordance with the table below which was
the committee structure as at 30 June 2023.
Role
Chair
Members
Audit &
Risk Committee1
Nomination
Committee
Remuneration &
Performance
Committee
People, Culture &
Governance
Committee
Joan Cleary
Frank O'Halloran, AM
Vicki Allen
Gai McGrath
David Liddy AM
Greg Rynenberg
David Liddy, AM
Vicki Allen
Frank O'Halloran AM
Joan Cleary
Robert Kelly, AM
Joan Cleary
Greg Rynenberg
1 Joan Cleary commenced as Chair of the Audit & Risk Committee on 16 March 2023 following Anne O'Driscoll retiring as a Non-Executive Director on 15 March 2023.
The table below contains the annual fee structure for the Steadfast Board and committees (inclusive of superannuation). The
remuneration details are set out in Section 4.3.
Board
$1
Audit & Risk
Committee
$
Nomination
Committee
$
Remuneration &
Performance
Committee
$
People, Culture &
Governance
Committee
$
Chair
Deputy Chair
Members
2023
2022
2023
2022
2023
2022
305,000
305,000
230,000
230,000
170,000
170,000
40,000
40,000
-
-
7,500
7,500
-
-
-
-
-
-
40,000
40,000
-
-
7,500
7,500
30,000
30,000
-
-
7,500
-
1 The board had previously increased Non-Executive Director fees in FY22 and deemed no increase for FY23.
Following a review by external consultants, the Directors have determined that fees will increase by a total of 10% in FY24. These
increases were benchmarked to comparable listed entities in terms of market capitalisation, revenue, assets and operations by GRG.
72 Steadfast Group Annual Report 2023
No additional remuneration will be paid to the Chair and members of the Nomination Committee nor for any directorships
of subsidiaries.
Board members are allocated to different Committees based on the requirements of the Committee, hence Board members do
not sit on all the Committees. All Directors are invited to attend all Committee meetings.
4.2. Minimum shareholding requirement
Non-Executive Directors are not required under the Company’s constitution to hold any Steadfast ordinary shares; however,
contained in each Director’s letter of appointment from the Company is a requirement that the Non-Executive Directors must hold
an amount equal to 50% of their annual remuneration in the Company’s ordinary shares by the end of their second year in office.
Refer Section 5.3 for details of Steadfast’s ordinary shares held by the Non-Executive Directors.
4.3. Remuneration details for Non-Executive Directors
The table below provides remuneration details of the Non-Executive Directors.
Short-term employment benefits
Post-
employment benefits
Board fees
$
Committee fees
$
Superannuation
$
Frank O’Halloran, AM
2023
2022
David Liddy, AM
2023
2022
Vicki Allen
2023
2022
Joan Cleary1
2023
2022
Gai McGrath
2023
2022
Greg Rynenberg
2023
2022
Former Non-Executive Director
Anne O'Driscoll2
2023
2022
279,708
281,432
208,145
209,091
153,846
170,000
141,026
-
170,000
170,000
153,846
154,546
115,385
154,545
-
-
-
-
36,199
31,667
20,456
-
30,000
30,000
13,575
13,636
27,149
36,364
1 2023 fees for Joan Cleary are from 28 July 2022 being her appointment date.
2 2023 fees for Anne O'Driscoll are until 15 March 2023 being her retirement date.
Total
$
305,000
305,000
230,000
230,000
210,000
201,667
25,292
23,568
21,855
20,909
19,955
-
16,956
178,438
-
-
-
17,579
16,818
14,966
19,091
-
200,000
200,000
185,000
185,000
157,500
210,000
Steadfast Group Annual Report 2023 73
Remuneration Report continued
5. Additional information
5.1. Use of remuneration consultant
The Remuneration & Performance Committee directly engages with, and considers market remuneration data from, remuneration
consultants as required as a guide for remuneration decisions with respect to the Executive Team. Remuneration consultants are
engaged no less than every three years to provide information on fixed remuneration packages and incentives to the Remuneration
& Performance Committee.
An external remuneration consultant, Godfrey Remuneration Group, was engaged during the financial year to conduct
remuneration benchmarking of the Non-Executive Directors fees.
5.2. Valuation of conditional rights
The table below details the fair value of rights issued affecting remuneration of KMP in the previous, current or future
reporting periods:
Description of conditional rights
Recipient
Grant date
Vesting date
Volume
weighted
average share
price
$2
Fair value at
grant date
$1
October 2022 STI3
August 2022 STI3
October 2021 STI3
October 2021 STI3
October 2021 STI3
August 2021 STI3
August 2021 STI3
August 2021 STI3
October 2020 STI4
October 2020 STI4
August 2020 STI4
August 2020 STI4
October 2019 STI4
August 2019 STI4
October 2022 LTI
August 2022 LTI
October 2021 LTI
August 2021 LTI
October 2020 LTI
August 2020 LTI
October 2019 LTI
August 2019 LTI
MD & CEO
20-Oct-22
16-Aug-23
Other Executives
17-Aug-22
16-Aug-23
MD & CEO
MD & CEO
MD & CEO
22-Oct-21
16-Aug-22
22-Oct-21
16-Aug-23
22-Oct-21
16-Aug-24
Other Executives
16-Aug-21
16-Aug-22
Other Executives
16-Aug-21
16-Aug-23
Other Executives
16-Aug-21
16-Aug-24
MD & CEO
MD & CEO
28-Oct-20
25-Aug-22
28-Oct-20
25-Aug-23
Other Executives
25-Aug-20
25-Aug-22
Other Executives
25-Aug-20
25-Aug-23
MD & CEO
17-Oct-19
21-Aug-22
Other Executives
21-Aug-19
21-Aug-22
MD & CEO
20-Oct-22
16-Aug-25
Other Executives
17-Aug-22
16-Aug-25
MD & CEO
22-Oct-21
16-Aug-24
Other Executives
16-Aug-21
16-Aug-24
MD & CEO
28-Oct-20
25-Aug-23
Other Executives
25-Aug-20
25-Aug-23
MD & CEO
17-Oct-19
21-Aug-22
Other Executives
21-Aug-19
21-Aug-22
4.7378
5.3810
4.7884
4.7783
4.7635
4.6832
4.6678
4.6450
3.5496
3.5338
3.5018
3.4830
3.5723
3.5194
4.4177
5.0011
4.5686
4.3561
3.3398
3.2525
3.3868
3.2975
5.3864
5.3864
4.6856
4.6856
4.6856
4.6856
4.6856
4.6856
3.5146
3.5146
3.5146
3.5146
3.5057
3.5057
5.3864
5.3864
4.6856
4.6856
3.5146
3.5146
3.5057
3.5057
1 The fair value at grant date is determined in accordance with Accounting Standard AASB 2 Share-based Payment.
2 To calculate the number of conditional rights to be granted, the award value is divided by the VWAP of shares of Steadfast over the five trading days on the Australian
Securities Exchange prior to Steadfast announcing its full year results.
3 The STI conditional rights granted all vest after one year from grant date.
4The STI conditional rights granted all vest in three equal tranches after one, two and three years from the grant date.
74 Steadfast Group Annual Report 2023
5.3. Shareholdings
The table below summarises the movement in holdings of ordinary shares during the financial year and the balance at the end of
the financial year both in total and held nominally by related parties of KMP.
Total shares
held at
1 July 2022
Purchases
SPP
allocation
Shares
transferred
upon vesting
of DEA
Total shares
held at
30 June
2023
Shares held
nominally at
30 June
20231
DRP
Sales
Frank O’Halloran, AM2
1,122,961
David Liddy, AM2
161,090
Robert Kelly, AM2
3,152,927
Vicki Allen2
Joan Cleary2
Gai McGrath2
Anne O’Driscoll2
10,0003
10,000
45,000
55,840
175,150
Greg Rynenberg2
1,004,860
Nigel Fitzgerald
-5
Samantha Hollman
Stephen Humphrys
Allan Reynolds
368,226
400,301
606,234
-
-
-
-
-
-
-
-
-
-
-
25,212
-
-
-
6,303
6,303
-
-
-
-
-
-
-
-
482,653
-
-
-
-
-
-
123,502
188,069
-
-
-
-
426
-
-
25,915
-
-
-
(170,000)
978,173
934,673
(61,090)
100,000
100,000
(845,702)
2,789,878
-
-
-
-
-
-
-
45,000
45,000
26,729
62,143
-
62,143
175,1504
175,150
1,030,775
1,030,775
-
-
(131,298)
360,430
162,420
(188,370)
400,000
-
97,451
883
(35,000)
669,568
58,612
1 Shares held nominally are included in the column headed ‘Total shares held at 30 June 2023’. Total shares are held directly by the KMP and indirectly by the KMP’s related
parties, inclusive of domestic partner, dependants and entities controlled, jointly controlled or significantly influenced by the KMP.
2 For the Directors, total shares held directly and nominally also represented the relevant interest in the listed securities, being ordinary shares of the Company, as notified
by the Directors to the ASX in accordance with section 205G(1) of the Corporations Act 2001.
3 Joan Cleary commenced as a Non-Executive Director on 28 July 2022
4Anne O'Driscoll retired as a Non-Executive Director on 15 March 2023.
5 Nigel Fitzgerald commenced as KMP on 4 April 2023.
5.4. Related party transactions
The following transactions occurred with Directors’ (Robert Kelly, AM and Greg Rynenberg) related parties which are part of
Steadfast Network but are not part of Steadfast Group:
i. Sale of goods and services
Professional service fees received by Directors' related entities on normal commercial terms
22,000
16,000
The following balances are outstanding at the reporting date in relation to transactions with
related parties:
2023
$
2022
$
ii. Current receivable from related parties
Trade receivables from Directors' related entities
5.5. Hedging prohibition
8,800
24,976
All DEAs must remain at risk until they have fully vested. Accordingly, Executives must not enter into any scheme that specifically
hedges the value of equity allocated.
Steadfast Group Annual Report 2023 75
Directors’ Report continued
Rounding
The Group is of the kind referred to in the ASIC Corporations (Rounding in Financial/Directors’ Reports) Instrument 2016/191 issued
by the Australian Securities & Investments Commission. In accordance with that Instrument, amounts in the Directors’ Report and
financial report have been rounded to the nearest hundred thousand dollars, unless otherwise stated.
Signed at Sydney on 16 August 2023 in accordance with a resolution of the Directors.
Frank O’Halloran, AM
Chair
Robert Kelly, AM
Managing Director & CEO
76 Steadfast Group Annual Report 2023
Steadfast Group Annual Report 2023 77
KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation. Liability limited by a scheme approved under Professional Standards Legislation. Lead Auditor’s Independence Declaration under Section 307C of the Corporations Act 2001 To the Directors of Steadfast Group Limited I declare that, to the best of my knowledge and belief, in relation to the audit of Steadfast Group Limited for the financial year ended 30 June 2023 there have been: i. no contraventions of the auditor independence requirements as set out in the Corporations Act 2001 in relation to the audit; and ii. no contraventions of any applicable code of professional conduct in relation to the audit. KPMG David Kells Partner Sydney 16 August 2023 PAR_SIG_01 PAR_NAM_01 PAR_POS_01 PAR_DAT_01 PAR_CIT_01 Steadfast Group Limited
Consolidated statement of profit or loss
and other comprehensive income
For the financial year ended 30 June 2023
Notes
Fee and commission income
Less: brokerage commission paid
Net fee and commission income
Premium funding interest income
Share of profits of associates and joint ventures
12
Fair value (loss)/gain on listed investment
Net gain from change in ownership in equity businesses and
deferred consideration
Interest income
Other income
Employment expense
Operating, brokers’ support service and other expenses
Selling expense
Amortisation expense
Depreciation expense
Impairment expense – non-financial assets
Finance cost
Profit before income tax expense
Income tax expense
Profit after income tax expense for the financial year
PROFIT FOR THE FINANCIAL YEAR IS ATTRIBUTABLE TO:
Non-controlling interests
Owners of Steadfast Group Limited
7
7,12
18
4
2023
$'m
1,292.0
(283.6)
1,008.4
92.9
30.7
(2.4)
23.4
23.4
3.6
1,180.0
(484.0)
(158.7)
(60.7)
(62.9)
(25.4)
(19.7)
(31.0)
(842.4)
337.6
(109.8)
227.8
38.6
189.2
227.8
2022
$'m
1,048.3
(255.1)
793.2
72.8
25.9
2.3
9.3
3.9
4.0
911.4
(377.2)
(116.2)
(44.0)
(51.5)
(21.7)
(3.6)
(18.0)
(632.2)
279.2
(79.8)
199.4
27.8
171.6
199.4
78 Steadfast Group Annual Report 2023
Notes
2023
$'m
2022
$'m
OTHER COMPREHENSIVE INCOME
Items that may be reclassified subsequently to profit or loss
Cash flow hedge change in fair value
Net movement in foreign currency translation reserve
Income tax expense on other comprehensive income
Total other comprehensive income for the financial year, net of tax
Total comprehensive income for the financial year, net of tax
TOTAL COMPREHENSIVE INCOME FOR THE FINANCIAL YEAR IS
ATTRIBUTABLE TO:
Non-controlling interests
Owners of Steadfast Group Limited
EARNINGS PER SHARE
Basic earnings per share (cents per share)
Diluted earnings per share (cents per share)
5
5
4.3
1.9
(1.3)
4.9
232.7
38.6
194.1
232.7
18.4
18.4
-
(2.2)
-
(2.2)
197.2
27.8
169.4
197.2
17.9
17.9
The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the notes
to the financial statements.
Steadfast Group Annual Report 2023 79
Notes
2023
$'m
2022
$'m
19
19
13
13
7
7
12
14C
20
18
259.2
879.3
261.3
662.2
19.5
279.8
665.2
206.1
575.7
11.0
2,081.5
1,737.8
1,985.7
1,494.1
346.6
222.6
64.0
58.7
36.1
5.9
41.9
35.5
6.6
2,803.6
4,885.1
265.5
210.3
59.3
45.3
31.9
3.4
33.0
29.4
6.5
2,178.7
3,916.5
Steadfast Group Limited
Consolidated statement of financial position
As at 30 June 2023
ASSETS
Current assets
Cash and cash equivalents
Cash held on trust
Trade and other receivables
Premium funding receivables
Other
Total current assets
Non-current assets
Goodwill
Intangible assets
Investments in associates and joint ventures
Property, plant and equipment
Right-of-use assets
External shareholder loans
Loans to associates and joint ventures
Other financial assets
Deferred tax assets
Other
Total non-current assets
Total assets
80 Steadfast Group Annual Report 2023
LIABILITIES
Current liabilities
Payables on broking/underwriting agency operations
Trade and other payables
Premium funding payables
Corporate and subsidiary borrowings
Premium funding borrowings
Bank overdrafts
Lease liabilities
Deferred consideration
Provisions
Income tax payable
Total current liabilities
Non-current liabilities
Corporate and subsidiary borrowings
Premium funding borrowings
Deferred tax liabilities
Lease liabilities
Provisions
Deferred consideration
Other payables
Total non-current liabilities
Total liabilities
Net assets
EQUITY
Share capital
Treasury shares held in trust
Revaluation reserve
Other reserves
Retained earnings
Equity attributable to the owners of Steadfast Group Limited
Non-controlling interests
Total equity
Notes
2023
$'m
2022
$'m
8
8
8
10
8
8
18
10
9
9
9D
868.3
161.8
206.4
4.3
45.7
0.5
19.4
86.5
57.8
47.5
648.7
121.4
139.5
10.2
32.1
-
14.7
51.9
47.0
29.5
1,498.2
1,095.0
514.5
406.5
134.3
46.5
14.0
25.8
0.4
1,142.0
2,640.2
2,244.9
409.4
434.8
98.0
37.5
11.6
15.7
0.6
1,007.6
2,102.6
1,813.9
1,949.0
1,638.9
(15.9)
12.1
(46.5)
142.7
2,041.4
203.5
2,244.9
(15.9)
12.1
(42.7)
92.1
1,684.5
129.4
1,813.9
The above consolidated statement of financial position should be read in conjunction with the notes to the financial statements.
Steadfast Group Annual Report 2023 81
Steadfast Group Limited
Consolidated statement of changes in equity
For the financial year ended 30 June 2023
Equity attributable to owners of Steadfast Group Limited
Treasury
shares
held in
trust
$’m
Reval-
uation
reserve
$'m
Share
capital
$'m
Other
reserves
$’m
Retained
earnings
$’m
Non-
controlling
interests
$’m
Total
$’m
Total
equity
$’m
2023
Balance at 1 July 2022
1,638.9
(15.9)
12.1
(42.7)
92.1
1,684.5
129.4
1,813.9
Profit after income tax expense
Other comprehensive income for the period,
net of tax
Total comprehensive income
-
-
-
TRANSACTIONS WITH OWNERS IN THEIR
CAPACITY AS OWNERS:
Issue of share capital (Note 9)
310.1
Shares acquired and held in trust (Note 9)
Share-based payments
Shares (allotted)/allocated (Note 9)
Non-controlling interests of acquired entities
(Note 10)
Revaluation of put options over non-
controlling interests (Note 10G)
Change in equity interests in subsidiaries
without loss of control
Dividends declared and paid (Note 6)
-
-
-
-
-
-
-
-
-
-
(5.4)
-
5.4
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
189.2
189.2
38.6
227.8
4.9
4.9
-
-
7.8
(5.7)
-
(1.1)
(9.7)
-
4.9
-
4.9
189.2
194.1
38.6
232.7
-
-
-
-
-
-
-
310.1
(5.4)
7.8
(0.3)
-
-
-
-
310.1
(5.4)
7.8
(0.3)
-
5.9
5.9
(1.1)
-
(1.1)
(9.7)
63.7
54.0
-
(138.6)
(138.6)
(34.1)
(172.7)
Balance at 30 June 2023
1,949.0
(15.9)
12.1
(46.5)
142.7
2,041.4
203.5
2,244.9
82 Steadfast Group Annual Report 2023
Equity attributable to owners of Steadfast Group Limited
Treasury
shares
held in
trust
$’m
Reval-
uation
reserve
$'m
Share
capital
$'m
Other
reserves
$’m
Retained
earnings
$’m
Non-
controlling
interests
$’m
Total
$’m
Total
equity
$’m
2022
Balance at 1 July 2021
1,178.3
(13.9)
12.1
(51.1)
33.4
1,158.8
108.2
1,267.0
Profit after income tax expense
Other comprehensive loss
Total comprehensive income
-
-
-
TRANSACTIONS WITH OWNERS IN THEIR
CAPACITY AS OWNERS:
Issue of share capital (Note 9)
460.6
Shares acquired and held in trust (Note 9)
Share-based payments
Shares (allotted)/allocated (Note 9)
Non-controlling interests of acquired entities
(Note 10)
Revaluation of put options over non-
controlling interests (Note 10G)
Change in equity interests in subsidiaries
without loss of control
Dividends declared and paid (Note 6)
-
-
-
-
-
-
-
-
-
-
(6.5)
-
4.5
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
171.6
171.6
27.8
199.4
(2.2)
(2.2)
-
-
7.3
(4.9)
-
(1.9)
10.1
-
(2.2)
-
(2.2)
171.6
169.4
27.8
197.2
-
-
(1.1)
-
-
-
-
460.6
(6.5)
6.2
(0.4)
-
-
-
-
460.6
(6.5)
6.2
(0.4)
-
2.2
2.2
(1.9)
-
(1.9)
10.1
13.5
23.6
-
(111.8)
(111.8)
(22.3)
(134.1)
Balance at 30 June 2022
1,638.9
(15.9)
12.1
(42.7)
92.1
1,684.5
129.4
1,813.9
The above consolidated statement of changes in equity should be read in conjunction with the notes to the financial statements.
Steadfast Group Annual Report 2023 83
Steadfast Group Limited
Consolidated statement of cash flows
For the financial year ended 30 June 2023
Notes
2023
$'m
2022
$'m
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers
Payments to suppliers and employees, and Network broker rebates
Dividends received from associates and joint ventures
Interest received
Interest and other finance cost paid
Income taxes paid
Net cash from operating activities before customer trust account and premium
funding movements
Net cash outflow from premium funding customers
Net movement in customer trust accounts (net cash receipts/payments on behalf
of customers)
Net cash from operating activities
CASH FLOWS FROM INVESTING ACTIVITIES
Payments for acquisitions of subsidiaries and business assets
Cash acquired from acquisitions of subsidiaries and business assets
Payments for investments in associates and joint ventures
Payments for step-up investment in subsidiaries on hubbing arrangements
Dividends received from listed investment
Payments for additional shares in other financial assets
19
10
12
Payments for deferred consideration of subsidiaries, associates and business assets
10
Proceeds from disposal of investment in subsidiaries, net of cash disposed
Proceeds from part disposal of investment in subsidiaries on hubbing arrangements
Proceeds from disposal of investment in associates
Payments for property, plant and equipment
Payments for intangible assets
Net cash used in investing activities
1,229.3
(829.1)
27.3
22.8
(26.5)
(105.6)
318.2
(22.3)
128.7
424.6
927.2
(603.3)
26.9
3.4
(16.2)
(77.0)
261.0
(80.3)
67.0
247.7
(405.9)
(258.0)
106.3
(13.1)
(16.6)
0.6
(5.8)
(33.7)
-
30.0
6.2
(11.2)
(5.0)
103.7
(62.7)
(22.0)
0.3
(5.1)
(48.5)
1.7
35.5
1.2
(4.1)
(4.4)
(348.2)
(262.4)
84 Steadfast Group Annual Report 2023
Notes
2023
$'m
2022
$'m
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issue of shares
Payments for transaction costs on issue of shares
Dividends paid to owners of Steadfast, net of Dividend Reinvestment Plan
Dividends paid to non-controlling interests
Proceeds from borrowings (excluding premium funding)
Repayment of borrowings (excluding premium funding)
Net cash (outflow)/inflow from premium funding borrowings
Payments for purchase of treasury shares
Repayment of related party loans
Payments for related party loans
Repayment of non-related party loans
Payments for non-related party loans
Payment of lease liabilities
Net cash from financing activities
Net increase in cash and cash equivalents
Cash and cash equivalents at the beginning of the financial year
Effect of movements in exchange rates on cash held
8
8
8
9
233.4
(4.7)
(131.4)
(34.1)
207.9
(110.5)
(14.7)
(5.4)
13.6
(12.4)
1.1
(6.7)
(18.5)
117.6
194.0
945.0
(0.5)
Cash and cash equivalents at the end of the financial year
19
1,138.5
253.1
(4.3)
(107.9)
(22.3)
466.9
(399.4)
68.9
(6.5)
2.7
(9.1)
2.6
(7.3)
(14.0)
223.4
208.7
736.8
(0.5)
945.0
The above consolidated statement of cash flows should be read in conjunction with the notes to the financial statements.
Steadfast Group Annual Report 2023 85
Steadfast Group Limited
Notes to the financial statements
For the financial year ended 30 June 2023
Note 1. General information
This general purpose financial report is for the financial year ended 30 June 2023 and comprises the consolidated financial
statements for Steadfast Group Limited (Steadfast or the Company) and its subsidiaries and the Group’s interests in associates and
joint ventures (Steadfast Group or the Group). These financial statements are presented in Australian dollars, which is Steadfast’s
functional and presentation currency.
The Company is a for-profit listed public company limited by shares, which is incorporated and domiciled in Australia. Its registered
office and principal place of business is Level 4, 99 Bathurst Street, Sydney NSW 2000.
A description of the nature of the Group's operations and its principal activities is included in the Directors' Report, which is not part
of this financial report.
This general purpose financial report was authorised for issue by the Board on 16 August 2023.
Note 2. Significant accounting policies
A. Statement of compliance
This financial report has been prepared in accordance with the Corporations Act 2001, Australian Accounting Standards and
other authoritative pronouncements of the Australian Accounting Standards Board, as appropriate for for-profit entities and the
Australian Securities Exchange (ASX) Listing Rules.
International Financial Reporting Standards (IFRS) refer to the overall framework of standards and pronouncements approved by
the International Accounting Standards Board. IFRS forms the basis of the Australian Accounting Standards. This financial report
of the Group complies with IFRS.
B. Basis of preparation of the financial report
The significant accounting policies adopted in the preparation of this financial report have been applied consistently by all entities in
the Group and are the same as those applied for the previous reporting period unless otherwise noted. These financial statements
have been prepared under the historical cost convention, modified, where applicable, by the measurement at fair value of certain
non-current assets, financial assets and financial liabilities.
I. Rounding
The Group is of the kind referred to in the ASIC Corporations (Rounding in Financial/Directors’ Reports) Instrument 2016/191 issued
by the Australian Securities and Investments Commission. In accordance with that Instrument, amounts in this financial report have
been rounded to the nearest hundred thousand dollars, unless otherwise stated.
C. Principles of consolidation
I. Business combinations
The Group accounts for business combinations using the acquisition method when control is transferred to the Group. The
consideration transferred in the acquisition is measured at fair value, as are the identifiable net assets acquired. The excess of the
consideration transferred over the fair value of identifiable net assets acquired and non-controlling interests (NCI) is recorded
as goodwill. If the consideration transferred is less than the fair value of identifiable net assets acquired and NCI, the difference
is recognised directly in the consolidated statement of profit or loss and other comprehensive income. Costs of acquisition are
expensed as incurred, except if they relate to the issue of debt or equity securities.
II. Subsidiaries
Subsidiaries are entities controlled by the Group. The Group controls an entity when it is exposed to, or has rights to, variable returns
from its involvement with the entity and has the ability to affect those returns through its power over the entity. The financial
statements of subsidiaries are included in the consolidated financial statements of the Group from the date on which control
commences until the date on which control ceases.
III. Non-controlling interests
NCI are measured at their proportionate share of the acquired subsidiaries’ identifiable net assets at the date of acquisition. For
operations and businesses being put into a business hub, NCI represent the fair value at the hubbing date. Changes in the Group’s
interest in a subsidiary that do not result in a loss of control are accounted for as equity transactions.
86 Steadfast Group Annual Report 2023
IV. Loss of control
When the Group ceases control over a subsidiary, it derecognises the assets and liabilities of the subsidiary, and any related NCI
and other components of equity. Any resulting gain or loss is recognised in the consolidated statement of profit or loss and other
comprehensive income. Any interest retained in the former subsidiary is measured at fair value when control is lost.
V. Transactions eliminated on consolidation
Intra-group balances and transactions, and any unrealised income and expenses arising from intra-group transactions, are
eliminated in full.
VI. Investments in associates and joint ventures
Associates are those entities where the Group has significant influence, but not control or joint control, over the financial and
operating policies. Joint ventures are arrangements in which the Group has joint control, whereby the Group has rights to the net
assets of the arrangement, rather than rights to its assets and obligations for its liabilities.
Interests in associates and joint ventures are accounted for using the equity method. They are initially recognised at cost, which
includes transaction costs. Subsequent to initial recognition, the Group’s share of the profit or loss of associates and joint ventures
is included in the Group’s consolidated statement of profit or loss and other comprehensive income.
D. Revenue recognition
Revenue is recognised as the Group provides services. Revenue is recognised to the extent there is no future performance
obligation. Where there is a future performance obligation, a portion is deferred over the expected service period.
Revenue is measured based on the consideration to which the Group expects to be entitled in a contract. The Group's revenue
does not have a significant financing component so, for the purposes of determining the transaction price, there is no difference
between the promised consideration and the cash selling (invoice) price.
The Group’s revenue is disaggregated by reportable segment as disclosed in Note 4.
The Group recognises revenue on contracts when the service is provided, which is generally at the point in time when the invoice
is raised resulting in the recognition of a receivable. In circumstances where revenue earned but not invoiced is deemed material,
revenue is recognised on an accrual basis providing the relevant performance obligations have been satisfied.
I. Fee and commission income
The Group retains a portion of policy premiums as fee and commission income. Premiums are typically collected on an annual basis,
at or near invoice date (which could be up to 90 days from contract inception). In some cases, customers are given the option to
pay by instalments or are directed to a premium credit provider.
Commission, brokerage and fees are recognised when the related service has been provided (that is, when the quote has been
accepted and the policy is placed and bound by the insurer) and it is probable that the Group will be compensated for services
rendered, and the amount of consideration for such services can be reliably measured. This is deemed to be the invoice date. Where
there is a future obligation to provide claims handling services, a portion of the fee income is deferred over the expected service
period. The Group calculates the portion to be deferred by applying a cost plus margin approach to determine the stand-alone
selling price given this cost is unobservable.
The Group receives professional services fees from strategic partners such as insurers, premium funders and underwriting agencies
for services provided.
The Group utilises the practical expedient in AASB 15 to recognise the incremental costs of obtaining a contract as an expense when
incurred if the amortisation period of the asset that the entity would have recognised is one year or less. The Group applies a cost
plus margin approach to determine the stand-alone selling price given this cost is unobservable.
The Group may receive a claims experience benefit payment or payments in respect of certain types of insurance purchased for
the benefit of Steadfast Network brokers. Revenue is recognised for a claims experience benefit for a particular policy year when
it is likely that a claims experience benefit is receivable and the amount can be reliably measured.
Factors taken into account in recognising a claims experience benefit include the number of years that have passed since the end
of a policy year and whether various claims have been closed or can be reliably measured.
Steadfast Group Annual Report 2023 87
Notes to the financial statements continued
II. Premium funding income
Premium funding interest income is brought to account at amortised cost using the effective interest method. The effective
interest method calculates the amortised cost of a financial instrument and allocates the interest income or expense and any
application fee income that is considered an integral part of the effective interest rate over the relevant period. The effective
interest rate is that rate that exactly discounts estimated future cash payments or receipts through the expected life of the financial
instrument, or, when appropriate, a shorter period, to the net carrying amount of the financial asset or liability.
III. Other income
Other income is recognised when the right to receive payment is established.
E. Taxation
The Company (the head entity) and its wholly-owned Australian subsidiaries have formed an income tax consolidated group under
the tax consolidation regime. Consequently, these entities are taxed as a single entity and the deferred tax assets and liabilities of
these entities are offset in the consolidated financial statements.
In addition, certain controlled subsidiaries and their wholly-owned Australian subsidiaries have formed income tax consolidated
groups under the tax consolidation regime. These entities are also taxed as a single entity and the deferred tax assets and liabilities
of these tax consolidated groups are offset in the consolidated financial statements.
F. Cash and cash equivalents
Cash and cash equivalents includes cash at bank, deposits held at call with financial institutions and other short-term, highly liquid
investments with original maturities of three months or less that are readily convertible to known amounts of cash. This includes
cash held by the subsidiaries for business operation/operating expense purposes.
Cash held on trust is cash held for insurance premiums received from policyholders, which will ultimately be paid to underwriters or
insurers. Cash held on trust cannot be used to meet business operations/operating expenses other than payments to underwriters,
insurers and/or refunds to policyholders.
G. Trade and other receivables
Trade and other receivables includes fee and commission receivables recognised at amoritised cost, net of the associated expected
credit loss (ECL) provision, as well as other receivables. Refer to Note 3F for additional information on the calculation of the
ECL provision.
H. Premium funding receivables
Premium funding receivables represent the amounts due from clients in the Group’s premium funding businesses and are
recognised at amortised cost, net of the associated ECL provision. Funds are collected on a monthly instalment basis and generally
within 12 months of the loan issuance date. Refer to Note 3F for additional information on the calculation of the ECL provision.
I. Property, plant and equipment
Items of plant and equipment are measured at cost, less accumulated depreciation and any accumulated impairment losses. The
carrying value of plant and equipment is periodically reviewed for impairment when events or changes in circumstances indicate
that the carrying value may not be recoverable.
Any gain or loss on disposal of an item of plant and equipment is recognised in the consolidated statement of profit or loss and
other comprehensive income.
I. Land and buildings
The Group recognises land and buildings at fair value, being Board valuation based on an independent appraisal. The Group obtains
regular independent appraisals to ensure that the carrying amount of land & buildings reported does not differ materially from its
fair value.
Any surplus arising on the revaluation of land and buildings is accumulated in equity under ‘revaluation reserve’. Any deficit on
revaluation is recognised in profit or loss except to the extent that it reverses a previous revaluation surplus on the same asset, in
which case the deficit is recognised as a reduction in the revaluation reserve within equity.
88 Steadfast Group Annual Report 2023
J. Intangible assets
Intangible assets acquired separately or in a business combination (mainly goodwill, customer relationships and capitalised
software) are initially measured at cost. The cost of an intangible asset acquired in a business combination is its fair value as at the
date of acquisition. The useful lives of these intangible assets are assessed on acquisition.
Internally developed software costs are capitalised once the project is assessed to be feasible. The costs capitalised include
licensing and direct labour costs. The useful lives of capitalised software assets are assessed when the projects are completed and
available for use.
Following initial recognition, intangible assets are carried at cost less any accumulated amortisation and provision for impairment.
Intangible assets with finite lives are amortised over their useful lives, currently estimated to be up to 10 years, and their useful lives
are reviewed annually.
Software-as-a-Service (SaaS) arrangements are service contracts that provide the Group with the right to access the cloud
provider's application software over the contract period. As no intangible asset is created at the contract commencement date, the
costs incurred in relation to SaaS arrangements are treated as follows:
Fee for use of application software and customisation costs - recognised as an expense over the term of the service contract.
Configuration, migration, testing and training costs - recognised as an expense as the service is received.
K. Premium funding borrowings
The Group’s premium funding borrowings are loans from third party financial institutions to finance the premium funding
businesses. These loans have recourse to the assets of the premium funding businesses only and are not cross-collateralised with
other borrowings in the Group.
They are initially recognised at the value of the consideration received, less any directly attributable transaction costs. Subsequent
measurement is at amortised cost using the effective interest method.
L. Payables on broking/underwriting agency operations
These amounts represent insurance premiums payable to insurers for broking/underwriting agency operations on amounts
received from customers (policyholders) prior to the end of the financial year.
M. Hedge accounting
Hedge accounting is applied when the Group designates certain derivatives to be part of a hedging relationship and they meet the
criteria for hedge accounting.
The Group uses cash flow hedges to mitigate the risk of variability of future cash flows attributable to interest rate fluctuations
associated with the corporate debt facility. For cash flow hedges, the portion of the gain or loss on the hedge instrument that
is effective is recognised in other comprehensive income, while the ineffective portion is recognised in profit or loss. Amounts
deferred in equity are transferred to profit or loss in the same period the hedged item is recognised in profit or loss.
N. Australian Accounting Standards issued and not yet effective
The Group has not early adopted nor applied any new, revised or amending Australian Accounting Standards and Interpretations
that are not yet mandatory for the financial year ended 30 June 2023.
The Group intends to adopt new, revised or amending Australian Accounting Standards and Interpretations in the operating
year commencing 1 July after the effective date of these standards and interpretations as set out in the table below. Additional
disclosures as a result of adopting these new accounting standards will be provided in accordance with the disclosure requirements.
The Group does not expect any material impact on the financial position or performance of the Group as a result of applying the
new accounting standard.
Title
Description
AASB 171
Insurance Contracts
Effective Date
Operating year
1 January 2023
30 June 2024
1 AASB 17 Insurance Contracts was issued in July 2017 as a replacement for AASB 4 Insurance Contracts and is applicable to general, life and health insurance businesses.
As the Group is an intermediary and does not assume or retain any material underwriting risk on insurance contracts or reinsurance contracts issued on behalf of licensed
insurers, no significant financial impact to the Group is expected from AASB 17.
Steadfast Group Annual Report 2023 89
Notes to the financial statements continued
Note 3. Critical accounting judgements, estimates and assumptions
The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect
the reported amounts in the financial statements. Management continually evaluates its judgements and estimates in relation to
assets, liabilities, contingent liabilities, revenues and expenses. Management bases its judgements, estimates and assumptions on
historical experience and on various other factors, including expectations of future events management believes to be reasonable
under the circumstances. The resulting accounting judgements and estimates may differ from the actual results. The judgements,
estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and
liabilities (refer to the respective notes) subsequent to the financial year ended 30 June 2023 are discussed below.
The Group has considered the impact of economic conditions such as inflation and the rising interest rate environment when
preparing the consolidated financial statements and related note disclosures, including the impact on the Group's forecast cash
flows and liquidity. While the effects of these uncertainties do not change the significant estimates, judgements and assumptions
considered by management in the preparation of the consolidated financial statements, they increase the level of estimation
uncertainty and the application of further judgement within these identified areas.
A. Goodwill
Goodwill is not amortised but assessed for impairment annually or more frequently when there are indicators of impairment.
The recoverable amount of goodwill is estimated using the higher of fair value or the value in use of the relevant cash-generating
unit (CGU) deducting the carrying amount of the identifiable net assets of the CGU. Key assumptions used in the calculation of
recoverable amounts are the discount rates, terminal value growth rates and inputs to revenue and expense growth assumptions.
B. Intangible assets
The carrying amounts of intangible assets with finite lives are reviewed at each reporting date to determine whether there is
any indication of impairment. If any such indication exists, the asset’s recoverable amount is estimated on the same basis as
goodwill above.
An impairment loss is recognised if the carrying amount of the intangible asset exceeds its recoverable amount.
C. Investments in associates and joint ventures
Investments in associates and joint ventures are carried at the lower of the equity-accounted amount and the recoverable amount.
The carrying amounts of investments in associates and joint ventures are reviewed at each reporting date to determine whether
there is any indication of impairment. If any such indication exists, the asset’s recoverable amount is estimated on the same basis
as goodwill above.
An impairment loss is recognised if the carrying amount of the investment in associates and joint ventures exceeds its
recoverable amount.
D. Fair value of assets acquired
The Group measures the net assets acquired in a business combination at their fair value at the date of acquisition. If new
information obtained within one year from the acquisition date about facts and circumstances that existed at the acquisition date
identifies adjustments to the fair value, then the amounts recognised at the acquisition date will be retrospectively revised.
Fair value is estimated with reference to market transactions for similar assets or discounted cash flow analysis.
E. Fair value of assets and liabilities
The Group’s assets and liabilities are measured at fair value (including costs to dispose) at balance date. The following table gives
information about how the fair value of assets and liabilities is determined, including the valuation techniques and inputs used. For
the Group’s assets and liabilities where a fair value methodology is not noted below, their carrying amounts provide a reasonable
approximation of their fair values.
90 Steadfast Group Annual Report 2023
Fair values are categorised into different levels in a fair value hierarchy, based on the inputs used in the valuation techniques,
as follows:
Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices)
or indirectly (i.e. derived from prices).
Level 3: inputs for the asset or liability that are not based on observable market data.
Asset or liability
Deferred
consideration
Fair value
hierarchy
Level 3
Land and buildings
Level 3
Valuation technique
Significant
unobservable inputs
Relationship of unobservable
inputs to fair value
The fair value is calculated
based on a contracted multiple,
typically of forecast EBITA or
fees and commissions
The fair value is determined
using an independent appraisal
by qualfied property valuers.
An appraisal was performed for
the year ending 30 June 2023,
which has formed the basis
of management's valuation.
The valuation is based on the
capitalisation of net income
(discounted cash flow) and
direct comparison approaches.
Forecast EBITA or fees
and commissions
Forecast cash flows
and market value are
driven largely by market
yield. Yield is impacted
by numerous factors
including rental growth,
occupancy rates and
rental incentives which are
all driven by supply and
demand forces. Forecast
cash flows are also
impacted by the discount
rate adopted.
The estimated fair value would
increase/decrease if the forecast
EBITA or fees and commissions
were higher/lower
The estimated fair value would
increase/decrease if market
yields were higher/lower
The estimated fair value would
decrease/increase if the discount
rate used was higher/lower
Interest rate swaps
(other financial assets)
Level 2
Investment in
listed shares (other
financial assets)
Level 1
The fair value is calculated
using the present value of
the estimated future cash
flow based on observable
yield curves
The fair value is calculated
based on the number of shares
multiplied by the quoted price
on the ASX at balance date
Not applicable
Not applicable
Not applicable
Not applicable
F. Expected credit loss provision
The ECL provision is estimated based on the analysis of aged receivables, as the Group assumes that the credit risk on fee and
commission receivables increases significantly if it is more than 90 days past due, as well as based on assumptions made on
forward-looking information. For the premium funding businesses, the ECL provision is based on historical analysis of credit losses
for loans in arrears, having considered whether this remains appropriate.
G. Climate change
Climate change is a global risk that is material for the insurance industry including insurers’ operations, customers and the whole
economy. Climate change may increase the frequency and severity of acute weather-related events such as floods, bushfires and
storms, as well as giving rise to changes such as rising sea levels, increased heat waves and droughts.
The principal activities of the Group are the provision of services to Steadfast Network brokers, the distribution of insurance policies
via insurance brokerages and underwriting agencies, and related services. As such the Group is not exposed to climate change risk
to the same extent as insurers that underwrite the risk of an insurance policy. Whilst the potential risks and related opportunities
from climate change are considered as part of the Group's asset impairment review methodology and processes, based on what
is currently known, it is not expected that climate risks will have a significant impact on the Group's principal activities, particularly
from an asset impairment standpoint.
Steadfast Group Annual Report 2023 91
Notes to the financial statements continued
Note 4. Operating segments
The Group’s corporate structure includes equity investments in insurance intermediary entities (insurance broking and underwriting
agencies), premium funders and complementary businesses. Discrete financial information about each of these service lines
is reported to management on a regular basis and, accordingly, management considers each service line to be a discrete
business operation.
The Group distributes insurance and issues premium funding products primarily in Australia and New Zealand. The Group is
also expanding its footprint in the United Kingdom and Singapore, and has a controlling interest in UnisonSteadfast, a network
headquartered in Germany. Regarding geographical information, the revenue and non-current assets attributed to geographies
outside of Australasia are currently immaterial to the Group and hence no separate geographical disclosure has been provided.
The financial performance of the Group’s operating segments is regularly provided to the Chief Operating Decision Maker
(considered to be the Managing Director & CEO) for each discrete business operation. The table below presents the financial
performance for the Group's insurance intermediaries and premium funders on an aggregated basis as each discrete business
operation within these operating segments is considered to have similar economic characteristics. The financial performance of
each of these operating segments is presented on an unconsolidated basis, that is, gross of transactions between reportable
segments. Intercompany eliminations between insurance intermediaries and premium funders are disclosed separately below.
Insurance
intermediary
$'m
Premium
funding
$’m
Intercompany
eliminations
$’m
Total
underlying
$’m
Re-
classifications
$’m1
Other
$’m
Non-
trading
items
$’m2
Total
statutory
$’m
1,292.5
91.1
35.3
(9.4)
1,409.5
(253.3)
23.8
1,180.03
(985.3)
(81.2)
(39.2)
9.4
(1,096.3)
278.0
(24.1)
(842.4)
2023
Total revenue
Total expenses
Share of EBITA
from associates and
joint ventures
Financing expense
- associates
Amortisation expense
- associates
Net profit/(loss) before
income tax
Income tax
(expense)/benefit
Net profit/(loss) after
income tax
37.7
0.1
1.2
(1.9)
(1.4)
-
-
(0.1)
(0.7)
341.6
10.0
(3.5)
(101.0)
(2.7)
0.4
240.6
7.3
(3.1)
Non-controlling interests
(37.5)
(0.3)
-
Net profit after income
tax attributable to
owners of Steadfast
Group Limited
203.1
7.0
(3.1)
-
-
-
-
-
-
-
-
39.0
(39.2)
0.3
0.1
(2.0)
(2.1)
1.9
2.1
348.1
(10.5)
-
-
-
(0.1)
-
337.6
(103.3)
10.5
(17.0)
(109.8)
244.8
(37.8)
207.0
-
-
-
(17.0)
227.8
(0.8)
(38.6)
(17.8)
189.2
1 Much of the reclassification relates to commissions paid by the Group's underwriting agencies. Such commissions are netted off against fee and commission income
in the statutory numbers, and are disclosed as expenses in the underlying numbers.
2 Refer Note 5B for a breakdown of non-trading item adjustments.
3 Total statutory revenue includes all income net of brokerage commission, as set out in the statement of profit or loss and other comprehensive income.
92 Steadfast Group Annual Report 2023
Insurance
intermediary
$’m
Premium
funding
$’m
Intercompany
eliminations
$'m
Total
underlying
$’m
Re-
classifications
$’m
Other
$’m
Non-
trading
items
$’m
Total
statutory
$’m
1,063.9
70.4
8.9
(805.3)
(60.9)
(20.6)
(7.3)
7.3
1,135.9
(879.5)
(235.6)
11.1
911.4
251.2
(3.9)
(632.2)
26.9
0.2
0.9
(0.6)
-
(0.1)
(1.7)
(0.1)
(0.2)
283.2
9.6
(11.1)
(79.7)
(3.2)
(3.2)
203.5
(26.2)
6.4
(14.3)
(0.4)
-
177.3
6.0
(14.3)
-
-
-
-
-
-
-
-
28.0
(27.1)
(0.9)
(0.7)
(2.0)
0.7
2.0
-
-
-
-
-
281.7
(8.8)
6.3
279.2
(86.1)
8.8
(2.5)
(79.8)
195.6
(26.6)
169.0
-
-
-
3.8
(1.2)
199.4
(27.8)
2.6
171.6
2022
Total revenue
Total expenses
Share of EBITA
from associates and
joint ventures
Financing expense
- associates
Amortisation expense
- associates
Net profit/(loss) before
income tax
Income tax
(expense)/benefit
Net profit/(loss) after
income tax
Non-controlling interests
Net profit after income
tax attributable to
owners of Steadfast
Group Limited
Steadfast Group Annual Report 2023 93
Notes to the financial statements continued
Note 5. Earnings per share
A. Reporting period value
Basic earnings per share
Diluted earnings per share
Excluding non-trading items, the underlying earnings per share would be as follows:
Basic earnings per share
Diluted earnings per share
B. Reconciliation of earnings used in calculating earnings per share
Profit after income tax
Non-controlling interests
2023
Cents
18.4
18.4
20.2
20.2
2023
$'m
227.8
(38.6)
2022
Cents
17.9
17.9
17.6
17.6
2022
$'m
199.4
(27.8)
Profit after income tax attributable to the owners of Steadfast Group Limited for calculation of
statutory basic and diluted earnings per share
189.2
171.6
Adjustments for non-trading items (net of tax and non-controlling interests):
Deferred consideration expense (where actual earnout was more than expected)
Deferred consideration income (where actual earnout was less than expected, excluding IBA)
Net adjustment relating to IBA acquisition (refer note 7F)
Impairment of non-IBA investments
Mark-to-market losses/(gains) from revaluation of listed investments
Net gain from change in value or sale of businesses and other movements
17.8
(1.4)
(0.5)
1.9
1.7
(1.7)
18.0
(5.5)
-
3.5
(1.6)
(17.0)
Underlying profit after income tax attributable to the owners of Steadfast Group Limited for
calculation of underlying basic and diluted earnings per share
207.0
169.0
C. Reconciliation of weighted average number of shares used in calculating earnings per share
I. Weighted average number of ordinary shares issued
Weighted average number of ordinary shares issued
Weighted average number of treasury shares held in trust
Weighted average number of ordinary shares used in calculating basic earnings per share
II. Weighted average number of dilutive potential ordinary shares
Weighted average number of ordinary shares
Dilutive potential ordinary shares issuable under share-based payments arrangements
Weighted average number of ordinary shares used in calculating diluted earnings per share
94 Steadfast Group Annual Report 2023
2023
Number in
'm
2022
Number in
'm
1,028.5
(3.4)
1,025.1
1,025.1
2.0
1,027.1
962.9
(3.9)
959.0
959.0
2.2
961.2
The weighted average number of ordinary shares or dilutive potential ordinary shares is calculated by taking into account the period
from the issue date of the shares to the reporting date unless otherwise stated as below:
Steadfast operates share-based payment arrangements (being an employee rights scheme, a short-term incentive plan and a
long-term incentive plan) where eligible employees may receive conditional rights (rights) instead of cash. One right will convert to
one ordinary share subject to vesting conditions being met. These share-based payment arrangements are granted to employees
free of cost and no consideration is payable on conversion to Steadfast’s ordinary shares. These arrangements have a dilutive effect
on the basic EPS.
Note 6. Dividends
A. Dividends on ordinary shares
2023
2023 interim dividend
2022 final dividend
2022
2022 interim dividend
2021 final dividend
Cents per share
Total amount
$'m
Payment date
Tax rate for
franking credit
Percentage
franked
6.0
7.8
5.2
7.0
62.3
76.3
22 March 2023
9 September 2022
50.8
23 March 2022
61.0
10 September 2021
30%
30%
30%
30%
100%
100%
100%
100%
It is standard practice that the Board declares the dividend for a period after the relevant reporting date. A dividend is not accrued
until it is declared and so the dividends for a period are generally recognised and measured in the financial reporting period following
the period to which the dividends relate.
The dividends recognised in the current reporting period include $0.4 million (2022: $0.4 million) paid in relation to treasury shares
held in a trust controlled by the Group. All the treasury shares participate in the DRP.
B. Dividend policy
The Company targets a dividend payout ratio in the range of 65% to 85% of underlying NPAT attributable to shareholders of the
Company with a minimum dividend payout ratio of 50% of net profit after tax and before amortisation, impairment and other
non-trading items (NPATA).
C. Dividend Reinvestment Plan
A DRP allows equity holders to elect to receive their dividend entitlement in the form of the Company’s ordinary shares. The price of
DRP shares is the average share market price calculated over the pricing period (which is at least five trading days) less any discount
as determined by the Board for each dividend payment date.
D. Dividend not recognised at reporting date
On 16 August 2023, the Board resolved to pay the following dividend. As this occurred after the reporting date, the dividends
declared have not been recognised in this financial report.
2023 final dividend
9.0
93.5
21 September 2023
30%
100%
Cents per share
Total amount
$'m
Expected
payment date
Tax rate for
franking credit
Percentage
franked
The Company’s DRP will operate by the on-market purchase of shares. No discount will be applied. The last election notice for
participation in the DRP in relation to this final dividend is 23 August 2023.
Steadfast Group Annual Report 2023 95
Notes to the financial statements continued
E. Franking credits
Franking account balance at reporting date at 30%
Franking credits to arise from payment of income tax payable
Franking credits available for future reporting periods
Franking account impact of dividends declared before issuance of financial report but not
recognised at reporting date
Franking credits available for subsequent financial year based on a tax rate of 30%
2023
$'m
112.8
26.3
139.1
(40.1)
99.0
2022
$'m
92.6
15.0
107.6
(32.7)
74.9
Note 7. Intangible assets
A. Composition
2023
At cost
Accumulated amortisation and impairment
B. Movements
2023
Balance at the beginning of the financial year
Additions
Additions through business combinations
Reduction upon loss of control
Amortisation expense
Impairment expense
Net foreign currency exchange difference
Balance at the end of the financial year
Customer
relationships
$'m
Capitalised
software
$'m
Other intangible
assets
$'m
Total
identifiable
intangible
assets
$'m
Goodwill
$'m
568.7
(264.8)
303.9
93.1
(51.3)
41.8
5.0
(4.1)
0.9
666.8
2,052.5
(320.2)
(66.8)
346.6
1,985.7
Customer
relationships
$'m
Capitalised
software
$'m
Other intangible
assets
$'m
225.9
3.5
126.7
(0.9)
(49.9)
(1.6)
0.2
303.9
38.8
13.51
2.6
(0.3)
(13.0)
-
0.2
41.8
0.8
0.1
-
(0.1)
-
-
0.1
0.9
Total
identifiable
intangible
assets
$'m
265.5
17.1
129.3
(1.3)
(62.9)
(1.6)
0.5
Goodwill
$'m
1,494.1
-
515.3
(8.3)
-
(16.2)
0.8
346.6
1,985.7
1 Comprises $13.0 million of internally developed software and $0.5 million of acquired software.
96 Steadfast Group Annual Report 2023
C. Composition
2022
At cost
Accumulated amortisation and impairment
D. Movements
2022
Balance at the beginning of the financial year
Additions
Additions through business combinations
Reduction upon loss of control
Amortisation expense
Impairment expense
Net foreign currency exchange difference
Balance at the end of the financial year
Customer
relationships
$'m
Capitalised
software
$'m
Other intangible
assets
$'m
Total
identifiable
intangible
assets
$'m
Goodwill
$'m
439.7
(213.8)
225.9
79.1
(40.3)
38.8
8.1
(7.3)
0.8
526.9
1,544.6
(261.4)
(50.5)
265.5
1,494.1
Customer
relationships
$'m
Capitalised
software
$'m
Other intangible
assets
$'m
167.8
5.3
94.9
(1.9)
(40.0)
(0.3)
0.1
225.9
33.5
16.81
-
(0.1)
(11.5)
-
0.1
38.8
Total
identifiable
intangible
assets
$'m
Goodwill
$'m
202.0
1,082.2
22.2
94.9
(2.0)
(51.5)
(0.3)
0.2
-
424.5
(8.6)
-
(3.3)
(0.7)
0.7
0.1
-
-
-
-
-
0.8
265.5
1,494.1
1 Comprises $16.5 million of internally developed software and $0.3 million of acquired software.
E. Amortisation rates per annum
2023
Customer
relationships
Capitalised
software
Other intangible
assets
Goodwill
Amortisation rates per annum
10.0% - 12.5% 20.0% - 100.0% 20.0% - 33.3%
-
F. Impairment testing
On an annual basis the Group performs impairment testing of goodwill and any identifiable intangibles and investments in
associates and joint ventures that have impairment indicators. In performing impairment testing, each business acquired or
portfolio of businesses acquired is considered a separate CGU or grouped into one CGU where operations are interdependent.
Goodwill and identifiable intangible assets are allocated across each of the Group’s CGUs, the majority of which operate in the
insurance intermediary segment. The goodwill and identifiable intangible assets allocated to each individual CGU outside the
insurance intermediary segment are not considered significant in comparison to the Group’s total carrying value of these assets.
For FY23, the Group recognised an impairment expense of $19.7 million in relation to two CGUs. One of these was Insurance Brands
Australia where, at acquisition, it was anticipated that the full earn out EBITA would be achieved. The FY23 underlying EBITA was
less than the full amount, so the asset was impaired $17.8 million ($17.4 million net of tax). This also reduced the earnout payable
to the vendors, meaning there was a gain on change in deferred consideration estimates of $17.9 million.
Steadfast Group Annual Report 2023 97
Notes to the financial statements continued
The carrying value of assets was reviewed against a number of potential scenarios to consider the potential impact of rising interest
rates and the volatile inflation environment.
Impairment losses for each category of intangible assets and investment in associates and joint ventures are shown in Section B and
D above and Note 12 respectively. When assessing the recoverable amount of customer relationships, the Group considers client
retention rates and current market conditions to determine both fair value and value in use of each CGU.
To conduct impairment testing, the Group compares the carrying value with the recoverable amount of each asset. The recoverable
amount is the higher of:
value in use – determined by reference to a discounted cash flow model, based on a five-year projection of the FY24 approved
budget of the tested CGUs with a terminal value; and
fair value less costs of disposal – based on the Group’s estimates of sustainable EBITA for each CGU multiplied by an earnings
multiple appropriate for similar businesses less costs to sell.
The following table outlines the key assumptions applied in the value in use and fair value less costs of disposal models:
Post-tax discount rates1
Pre-tax discount rates
2023
2022
9.1% to 12.9%
12.4% to 16.1%
9.0% to 12.5%
12.2% to 15.6%
Revenue growth rate – year two to five extrapolation2
2.0% to 5.0% per annum
2.0% to 5.0% per annum
Long-term revenue growth rate3
Earnings multiple4
3.0% per annum
3.0% per annum
10-14.2x EBITA
10-12.5x EBITA
1 Post tax discount rates reflect the Group’s weighted average cost of capital (WACC), adjusted for additional risks specific to each CGU. The WACC takes into account
market risks, size of the business, current borrowing interest rates, borrowing capacity of the businesses and the risk-free rate. External advice has been sought in relation
to the determination of the appropriate WACC. Flame Security International Pty Ltd is assessed on a bespoke model due to the unique nature and circumstances of
the business.
2 Year one FY24 approved budget applied
3 The Group considers that a long-term revenue growth rate of 3.0% is appropriate, based on the current market conditions and historical GWP trends.
4The Group applies an earnings multiple of 10 for all CGUs with the following exceptions: (1) CGUs where goodwill has been allocated for business combinations
performed within the last 12 months. For these CGUs, the Group applies the acquisition earnings multiple when determining the recoverable amount unless sources of
information suggest otherwise. (2) Large brokers, agencies and premium funders where market trends indicate a higher multiple is appropriate.
Given the economic outlook with regard to rising interest rates and inflation, and the associated impact on asset valuation, the
Group ran a number of scenarios and took a probability weighted approach to estimate value in use. The growth rate assumptions
utilised in the value in use model are shown above.
A reasonable change in individual assumptions would result in the following impairments:
WACC rate increased by 100bps: an additional $4.4 million impairment
Revenue growth rate in years two to five decreased by 0.5%: an additional $2.6 million impairment
Long-term revenue growth rate decreased by 0.5%: an additional $0.5 million impairment
Earnings multiple decreased by 1x: an additional $19.6 million impairment
The Group has also considered the impact of climate change from an asset impairment standpoint. The Group has incorporated the
potential risks and opportunities of climate change in the current asset impairment review methodology and processes. The Group
operates a decentralised business model with diversified service lines and product offerings, and is not exposed to concentration
risk with respect to industry or location. On that basis, it is not expected that climate risks will have a significant impact on the
Group's principal activities.
Note 8. Borrowings
The Group has two types of borrowings, as follows:
I. Corporate and subsidiary borrowings - Bank loans and lines of credit in corporate and subsidiaries for the purpose of carrying
out the Group’s principal activities including the distribution of insurance policies through insurance brokerages and underwriting
agencies and related services, as well as acquisitions and bolt-ons. These loans are secured against the Group’s assets, excluding
IQumulate Premium Funding Pty Ltd (IQumulate).
98 Steadfast Group Annual Report 2023
II. Premium funding borrowings - Borrowings and issuance of notes to finance only the premium funding businesses
(predominantly IQumulate). These loans have recourse only to the assets of that premium funding business.
These two types of borrowings are not cross-collateralised, and therefore are shown separately.
The Group complied with all debt covenants during the financial year.
A. Corporate and subsidiary borrowings
I. Bank loans
Proceeds from loans and borrowings
Current
Non-current
Net proceeds
Accrued interest
Capitalised transaction costs
Carrying amount of liability at end of financial year
II. Bank facilities available
a. Bank facilities drawn down or applied
Bank loans - corporate facility
Bank loans - subsidiaries
Total bank loans
Lines of credit - corporate facility1
Lines of credit - subsidiaries
b. Bank facilities not drawn down or applied
Bank loans - corporate facility
Bank loans - subsidiaries
Lines of credit - corporate facility
Lines of credit - subsidiaries
c. Total bank facilities available
Bank loans
Lines of credit
2023
$'m
2022
$'m
4.3
513.7
518.0
2.6
(1.8)
518.8
10.2
410.4
420.6
1.7
(2.7)
419.6
2023
$'m
2022
$'m
437.0
81.0
518.0
6.4
0.5
340.0
80.6
420.6
5.2
-
524.9
425.8
213.0
10.0
3.6
61.5
288.1
741.0
72.0
813.0
310.0
10.7
4.8
13.7
339.2
741.3
23.7
765.0
1 Lines of credit represent bank guarantees granted by the Company on behalf of controlled entities, principally in respect of their contractual obligations on commercial
leases. They are contingent liabilities and therefore sit outside the Group balance sheet.
Steadfast Group Annual Report 2023 99
Notes to the financial statements continued
III. Corporate facility details
At 30 June 2023:
the Company had a $660.0 million multibank syndicated facility (corporate facility) (2022: $660.0 million); and
$437.0 million of the $660.0 million facility had been drawn down which, together with $6.4 million for bonds and rental
guarantees, leaves $216.6 million available in the corporate facility for future drawdowns (2022: $314.8 million).
IV. Key terms and conditions of corporate facility
The $660.0 million corporate facility includes the following tranches:
a revolving (partly drawn) $320.0 million tranche for three years, maturing November 2024;
a fully drawn (term loan) $140.0 million tranche for three years, maturing November 2024; and
a fully drawn (term loan) $200.0 million tranche for five years, maturing November 2026.
Subsequent to the balance date, these facilities were increased to $860.0 million and extended as follows:
two revolving tranches totalling $385.0 million, maturing August 2026;
two fixed-term tranches totalling $175.0 million, maturing August 2026;
a $200.0 million fixed-term tranche, maturing November 2026; and
a $100.0 million fixed-term tranche, maturing August 2028.
Other key terms of the corporate facility (which were broadly retained in the increased facility finalised subsequent to balance
date) are:
variable interest rate – based on BBSY plus an applicable margin for all tranches of the corporate facility; and
the facility is guaranteed by certain wholly-owned subsidiaries and is secured over all of the present and future acquired property
of the Company and the guarantors (other than certain excluded property), which is standard in facilities of this nature.
The Company has an interest rate swap with a face value of $62.5 million, where the Company swaps the floating rate payment
into fixed rate payments, which will mature in January 2025. Refer Note 14B for further details of the interest rate swap. The swap
is designed to hedge interest costs associated with the underlying corporate debt obligations.
B. Premium funding borrowings
I. Premium funding borrowings
Current
Non-current
II. Premium funding borrowings available
Premium funding borrowings drawn down or applied
Premium funding borrowings not drawn down or applied
2023
$'m
2022
$'m
45.7
406.5
452.2
452.2
130.7
582.9
32.1
434.8
466.9
466.9
72.3
539.2
The Group's premium funding subsidiary, IQumulate, has a Warehouse Trust to finance its Australian lending operation through the
issuance of notes. The Warehouse Trust is a secured lending facility whereby the collateral is a pool of insurance premium loans
receivable rather than an individual property or asset. During the financial year, the Warehouse Trust limit increased to $570.0 million
(including a $60.0 million overdraft facility) from $500.0 million with an availability period to July 2023. Subsequently, in July 2023,
the Warehouse Trust limit was increased to $660.0 million on renewal (including a $60 million overdraft facility), with an availability
period to July 2024. At 30 June 2023, whilst the contractual availability period ends in July 2023, the premium funding borrowings
have been classified as non-current in the statement of financial position as the contractual maturity date includes an amortisation
period giving the Group 12 months to repay from the date of the last maturing premium funding in the Warehouse Trust.
100 Steadfast Group Annual Report 2023
IQumulate continues to hold trade credit insurance coverage, and recourse to the assets is limited to IQumulate only and is not
cross-collateralised with other borrowings in the Group.
C. Reconciliation of movements of liabilities and cash flows arising from financing activities
Bank loans -
corporate
facility
$'m1
Bank loans -
subsidiaries
$'m
Bank loans -
corporate
facility and
subsidiaries
$'m
Premium
funding
borrowings
$'m2
Total
borrowings
$'m
2023
Balance at the beginning of the financial year
Proceeds from borrowings
Repayment of borrowings
Accrued interest
Amortisation of capitalised transaction costs
Balance at the end of the financial year
(net of capitalised transaction costs and
accrued interest)
339.0
202.0
(105.0)
0.9
0.9
80.6
5.9
(5.5)
-
-
419.6
207.9
(110.5)
0.9
0.9
466.9
0.1
(14.8)
-
-
886.5
208.0
(125.3)
0.9
0.9
437.8
81.0
518.8
452.2
971.0
1 The opening balance comprises $340.0 million drawn down less capitalised transaction costs of $2.7 million plus interest accrued of $1.7 million. The closing balance
comprises $437.0 million drawn down less capitalised transaction costs of $1.8 million plus interest accrued of $2.6 million.
2 Proceeds from and repayment of premium funding borrowings are classified as cash flows from operating activities in the Consolidated Statement of Cash Flows.
D. Borrowings by associates and joint ventures
At 30 June 2023, the Group’s associates and joint ventures had a total of $96.1 million (2022: $69.5 million) of bank borrowings
(including bank overdrafts and loans).
As the associates and joint ventures are equity-accounted, these borrowings are not included in the Group's consolidated
statement of financial position. The Group’s proportionate share of the associates’ and joint ventures’ bank borrowings is
$40.7 million (2022: $28.9 million). Refer Note 12C for summarised financial information of associates and joint ventures.
Steadfast Group Annual Report 2023 101
Notes to the financial statements continued
Note 9. Notes to the statement of changes in equity
A. Share capital
2023
Number of
shares
'm
2022
Number of
shares
'm
2023
$'m
2022
$'m
Reconciliation of movements
Balance at the beginning of the financial year
977.6
871.5
1,638.9
1,178.3
Shares issued for:
Institutional and retail share placement
Scrip issued to vendors for acquisitions
Dividend reinvestment plan
Less: Transaction costs, net of income tax
45.5
14.1
1.4
-
56.1
49.2
0.8
-
233.4
72.8
7.2
(3.3)
253.1
206.7
3.9
(3.1)
Balance at the end of the financial year
1,038.6
977.6
1,949.0
1,638.9
The following ordinary shares were issued during the financial year as a result of the capital raise, acquisitions and DRP:
43.8 million ordinary shares were issued under the institutional placement, 10.9 million ordinary shares as scrip consideration
for the acquisition of IBA and 3.2 million ordinary shares as scrip consideration for the acquisition of Perryman O'Grady Philpott
Pty Ltd.
1.7 million ordinary shares were issued under the Share Purchase Plan.
1.4 million ordinary shares were issued under the DRP.
Ordinary shares in the Company have no par value and entitle the holder to participate in dividends as declared from time to time.
All ordinary shares rank equally with regard to the Company’s residual assets.
B. Treasury shares held in Trust
Reconciliation of movements
Balance at the beginning of the financial year
Shares acquired
Shares allocated to employees
Shares allotted through the dividend reinvestment plan
Balance at the end of the financial year
2023
Number of
shares
'm
2022
Number of
shares
'm
3.9
1.0
(1.6)
-
3.3
3.9
1.3
(1.4)
0.1
3.9
2023
$'m
15.9
5.4
(5.8)
0.4
15.9
2022
$'m
13.9
6.5
(4.9)
0.4
15.9
Treasury shares are ordinary shares of the Company bought on market by the trustee (a wholly-owned subsidiary of the Group) of
an employee share plan to meet future obligations under that plan when rights vest and shares are allocated to participants.
102 Steadfast Group Annual Report 2023
C. Capital risk management
The Group’s objectives when managing capital are to safeguard its ability to continue as a going concern, so that it can provide
returns for shareholders and benefits for other stakeholders, maintain an optimal capital structure to minimise the cost of capital
and continue its listing on the ASX, within the risk appetite approved by the Board.
In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, return
capital to shareholders, issue new shares, take on borrowings or sell assets to reduce debt.
The Group monitors capital on the basis of its total gearing ratio excluding premium funding borrowings, as these borrowings are
secured only against the assets of the premium funder. The total gearing ratio is calculated as total borrowings of the Company
and its subsidiaries (excluding premium funding borrowings) divided by total equity and total borrowings of the Company and its
subsidiaries (excluding premium funding borrowings). Currently the total gearing ratio excluding premium funding borrowings is
18.9% compared with the maximum gearing ratio determined by the Board of 30.0%.
The total gearing ratio has been calculated both including and excluding the premium funding borrowings as follows:
Note
2023
$'m
2022
$'m
Maximum
Board
approved
8
8
524.9
2,244.9
2,769.8
19.0%
977.1
2,244.9
3,222.0
30.3%
425.8
1,813.9
2,239.7
19.0%
892.7
1,813.9
2,706.6
33.0%
30.0%
Total borrowings of the Company and its subsidiaries (excluding
premium funding borrowings)
Total Group equity
Total Group equity and total borrowings of the Company and
its subsidiaries
Total gearing ratio excluding premium funding borrowings
Total borrowings of the Company and its subsidiaries (including
premium funding borrowings)
Total Group equity
Total Group equity and total borrowings of the Company and
its subsidiaries
Total gearing ratio including premium funding borrowings
D. Nature and purpose of reserves
I. Other reserves
Other reserves includes three components as follows:
Foreign currency translation reserve: records the foreign currency differences from the translation of the financial information
of foreign operations that have a functional currency other than Australian dollars.
Share-based payments reserve: used to recognise the fair value at grant date of equity settled share-based remuneration
provided to employees.
Other reserves: used to recognise other movements in equity including cumulative net change in fair value of hedging
instruments; the present value of liabilities in respect of put options issued to the minority shareholders of certain subsidiaries
over those subsidiaries' shares; and the net effect on disposal of partial equity ownership in subsidiaries without loss of control.
II. Revaluation reserve
The revaluation reserve is used to record the movement in the fair value of the Group’s property following Board valuation based
on independent appraisal.
Steadfast Group Annual Report 2023 103
Notes to the financial statements continued
Note 10. Business combinations
Acquisitions
During the financial year ended 30 June 2023, the Group completed a number of acquisitions in accordance with its strategy. The
following disclosures provide the financial impact to the Group at the acquisition date. Only significant acquisitions are disclosed
separately. Other acquisitions are disclosed in aggregate.
Acquisition of subsidiaries
The following tables provide:
detailed information on the acquisition of Insurance Brands Australia Pty Ltd and its subsidiaries (IBA) on 17 August 2022; and
aggregated information for 38 other acquired businesses (Other acquisitions).
Note 10F includes the ownership interest in businesses acquired which became subsidiaries of the Group.
A. Consideration paid/payable
Cash
Consideration shares
Deemed consideration(ii)
Deferred consideration(iii)
Table notes
2023
Other
acquisitions
$'m
188.5
47.9(v)
31.5
39.6
Total
$'m
417.2
105.6
31.5
65.1
307.5
619.4
IBA
$'m
228.7
57.7(i)
-
25.5(iv)
311.9
2022
$'m
296.4
206.7
34.2
26.0
563.3
i. This amount represents the fair value of shares issued as consideration for the acquisition of IBA ($5.31 per share), which differs
from the institutional bookbuild price at the transaction date ($5.14 per share).
ii. This amount represents the fair value of the original investments at the date the Group gained control of an entity which was
previously an associate of the Group.
iii. Pursuant to the Share Purchase Agreements, some of the consideration will be settled based on future years’ actual financial
performance and thus was recognised as deferred consideration by the Group. The deferred consideration is estimated based
on a multiple of forecast revenue and/or earnings. Any variations at the time of settlement will be recognised as an expense
or income in the consolidated statement of profit or loss and other comprehensive income. The deferred consideration shown
above represents:
- $36.4 million of deferred consideration for which the maximum payment is variable and not capped;
- $27.5 million of deferred consideration which is variable and capped; and
- $1.2 million of deferred consideration which is fixed.
The deferred consideration excludes the present value of liabilities ($26.9 million) in respect of put options issued to the minority
shareholders of certain subsidiaries over those subsidiaries' shares (refer Note 10G).
iv.This amount represents $25.0 million in potential earn out payments and $0.5 million paid with respect to working capital
adjustments. At 30 June 2023, the earn out payment was agreed to be $7.1 million, with $17.9 million recognised as a gain
on reassessment.
v. Some acquisitions made through existing subsidiaries of the Group have been partially completed on a scrip for scrip basis (using
the subsidiaries' scrip). The share capital issued by the subsidiary is eliminated on consolidation.
104 Steadfast Group Annual Report 2023
B. Identifiable assets and liabilities acquired
Cash and cash equivalents1
Trade and other receivables2
Identifiable intangibles3
Investment in associates & joint ventures
Property, plant and equipment
Right-of-use assets
Deferred tax assets
Other assets
Trade and other payables
Lease liabilities
Provisions
Income tax payable
Deferred tax liabilities
Other liabilities
Total identifiable net assets acquired
2023
Other
acquisitions
$'m
39.5
22.3
75.8
-
0.6
4.5
1.8
0.8
Total
$'m
106.3
32.3
129.3
1.0
1.0
8.1
4.6
3.8
2022
$'m
103.7
15.1
94.9
75.2
2.6
6.0
6.5
2.6
(33.6)
(92.8)
(104.8)
(4.7)
(9.7)
(2.0)
(24.0)
(11.4)
59.9
(8.7)
(13.7)
(2.4)
(44.0)
(14.8)
110.0
(6.4)
(7.0)
(4.8)
(35.0)
(7.6)
141.0
IBA
$'m
66.8
10.0
53.5
1.0
0.4
3.6
2.8
3.0
(59.2)
(4.0)
(4.0)
(0.4)
(20.0)
(3.4)
50.14
1 Includes cash held on trust.
2 Trade receivables comprise contractual amounts and are expected to be fully recoverable.
3 Identifiable intangibles are measured at fair value by reference to a discounted cash flow model.
4Total identifiable net assets acquired from IBA has changed since 31 December 2022 reporting due to measurement period adjustments.
If new information obtained within one year from the acquisition date, about facts and circumstances that existed at the acquisition
date, identifies adjustments to the above amounts, then the acquisition accounting will be revised. In the current year, there were
no revisions relating to prior year acquisitions.
C. Goodwill on acquisition
Total consideration paid/payable
Total identifiable net assets acquired
Non-controlling interests
Goodwill on acquisition1
2023
Other
acquisitions
$'m
Total
$'m
307.5
619.4
(59.9)
(110.0)
5.9
253.5
5.9
515.3
IBA
$'m
311.9
(50.1)
-
261.8
2022
$'m
563.3
(141.0)
2.2
424.5
1 The majority of goodwill relates to acquired subsidiaries' ability to generate future profits with the skills and technical talent of their work force as well as the benefits
from the combination of synergies. None of the goodwill recognised is expected to be deductible for tax purposes.
Steadfast Group Annual Report 2023 105
Notes to the financial statements continued
D. Financial performance of acquired subsidiaries
The contribution to the financial performance of the Group by acquired subsidiaries for the period since acquisition is outlined in
the table below.
Revenue
EBITA
NPAT
2023
IBA
$'m
Other acquisitions
$'m
64.6
21.5
12.5
41.6
17.6
10.7
Total
$'m
106.2
39.1
23.2
If the acquisitions of subsidiaries occurred on 1 July 2022, the Group’s underlying revenue from acquisitions for the financial
year ended 30 June 2023 would have further increased by $43.5 million to $1,223.5 million, underlying EBITA would have further
increased by $14.2 million to $444.9 million and underlying NPAT would have further increased by $7.9 million to $214.9 million.
E. Acquisition-related costs
The Group incurred acquisition-related costs of $0.1 million on legal, accounting and consulting with respect to the IBA acquisition.
These costs have been included in 'Operating, brokers' support service and other expenses'. A further $3.3 million (net of tax) in
respect of the capital raise and scrip issue attributable to the IBA acquisition was capitalised to share capital.
F. Subsidiaries acquired
The table below outlines the subsidiaries acquired during the financial year ended 30 June 2023. Some acquisitions represent
portfolio or business purchases by subsidiaries and are therefore not included in this table.
Name of subsidiaries acquired
Austinsure Limited
Baileys Insurance Limited
Bruce Group Australia Pty Ltd
Clear Insurance Pty Ltd
Fenchurch Insurance Brokers Pty Ltd
Insurance Brands Australia Pty Ltd and its subsidiaries
Insurance Finance Group Pty Ltd
Melbourne Insurance Brokers Pty Ltd
Perryman O'Grady Philpott Pty Ltd
Surefire Insurance Brokers Pty Ltd and its subsidiaries
Trans-West Insurance Brokers (NSW) Pty Ltd (formerly Unity Trade Credit Pty Ltd)
Woodleigh Fields Pty Ltd (trading as Breakwater Insurance Brokers)
Table notes
Table note
(i)
(i)
(i)
(ii)
Ownership interest
2023
%
100.00
58.50
90.00
64.96
72.50
100.00
100.00
61.00
51.95
50.00
100.00
100.00
2022
%
-
40.00
-
-
22.50
-
-
49.00
-
-
-
-
i. During the year, the Group acquired additional shares in Fenchurch Insurance Brokers Pty Ltd (Fenchurch), Melbourne Insurance
Brokers Pty Ltd (Melbourne) and Baileys Insurance Ltd (Baileys). As a result, Fenchurch, Melbourne and Baileys, which were
previously associates, became subsidiaries of the Group. Fenchurch was initially increased to 70.00% and had an additional step
up to 72.50% in December 2022. The consideration paid/payable disclosed in section A relates to the initial step up to 70.00%.
Baileys had an initial investment of 43.5% in December 2022. In June 2023, Baileys stepped down to 38.5%, then stepped up to
56.5% and became a subsidiary. This was followed by an additional step up to 58.5%. The consideration paid disclosed in section
A relates to the step up from 38.5% to 56.5%.
106 Steadfast Group Annual Report 2023
ii. In December 2022, the Group acquired 80.00% of Perryman O'Grady Philpott Pty Ltd (Perryman). In February 2023, the Group
sold its shares to Network Insurance Group Pty Ltd (NIG). As NIG is 64.94% owned by the Group, the indirect ownership
of Perryman at 30 June 2023 is 51.95%. The consideration paid/payable disclosed in section A relates to the initial purchase
of 80.00%.
G. Deferred consideration reconciliation
The following table shows a reconciliation of movements in deferred consideration.
Balance at the beginning of the financial year
Settlement of deferred consideration
Non-cash settlement of deferred consideration
Additions from acquisitions in business combinations
Additions from subsidiary business combinations
Additions from revaluation of put options over non-controlling interests
Additions from acquisitions of associates
Additions from acquisitions of identifiable intangibles
Additions from step-up investments
Net (gain)/loss in profit or loss on settlement or reassessment
Balance at the end of the financial year
Comprises:
Deferred consideration current:
Put options over non-controlling interests2
Other
Deferred consideration non-current:
Other
Balance at the end of the financial year
2023
$'m
67.6
(33.7)
-
65.1
-
1.1
11.5
0.5
1.2
(1.0)1
112.3
26.9
59.6
25.8
112.3
2022
$'m
68.6
(48.5)
(0.5)
26.0
1.8
1.9
2.4
1.1
2.0
12.8
67.6
25.8
26.1
15.7
67.6
1 This includes $17.9 million gain on change in deferred consideration for IBA.
2 This deferred consideration will only be payable if the put option is exercised by the minority shareholder. If the option remains unexercised, the financial liability will be
derecognised against equity through other reserves at the expiry date.
The balance of deferred consideration at the end of the financial year represents:
Amount payable is variable and capped
Amount payable is variable and not capped
Amount payable is fixed
2023
$'m
8.7
91.9
11.7
112.3
2022
$'m
1.6
62.8
3.2
67.6
Steadfast Group Annual Report 2023 107
Notes to the financial statements continued
Note 11. Subsidiaries
The consolidated financial statements incorporate the assets, liabilities and results of the following key subsidiaries.
Name
A. Parent entity
Steadfast Group Limited
B. Subsidiaries - operating entities
I. Insurance broking businesses
Steadfast Insurance Brokers Pty Limited
Steadfast Insurance Brokers (New Zealand) Pty Ltd
Steadfast Group (UK) Ltd
Abbott NZ Holdings Limited and its subsidiaries
AFA Insurance Brokers Pty Ltd
Austinsure Limited
Ausure Group Pty Ltd and its subsidiaries
Baileys Insurance Limited
Ballyglisheen Pty Ltd
Bill Owen Insurance Services Pty Ltd1
Body Corporate Brokers Pty Ltd
Bruce Group Australia Pty Ltd and its subsidiaries
Centrewest Holdings Pty Limited and its subsidiaries
Clear Insurance Pty Ltd
Community Broker Network Pty Ltd and its subsidiaries
Consolidated Insurance Agencies Pty Ltd and its subsidiary
Consult Insurance Solutions Pty Ltd
Corporate Insurance Brokers Ballina (NSW) Pty Ltd
Coverforce Holdco Pty Ltd and its subsidiaries
Domina Group Pty Ltd and its subsidiary
Edgewise Insurance Brokers Pty Ltd and its subsidiaries
Fenchurch Insurance Brokers Pty Ltd
Galaxy Insurance Consultants Pte Ltd
Ginn & Penny Pty Ltd
Great Wall Insurance Services Pty Ltd
GSA Insurance Brokers Pty Ltd
Holdfast Insurance Brokers Pty Ltd
Ian Bell Insurance Brokers Pty Ltd
ICF (Australia) Pty Ltd and its subsidiary
Insurance Brands Australia Pty Ltd and its subsidiaries
Mega Capital Holdings Pty Ltd
Melbourne Insurance Brokers Pty Ltd
108 Steadfast Group Annual Report 2023
Ownership interest
Country
of incorporation
2023
%
2022
%
Australia
Australia
New Zealand
United Kingdom
New Zealand
Australia
100.00
100.00
100.00
71.31
71.00
New Zealand
100.00
Australia
New Zealand
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Singapore
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
50.07
58.50
59.63
-
100.00
90.00
79.96
64.96
100.00
55.00
100.00
100.00
100.00
70.00
100.00
72.50
60.00
70.00
67.50
58.82
70.00
75.05
100.00
100.00
100.00
61.00
100.00
100.00
100.00
68.34
71.00
-
50.07
40.00
59.63
100.00
100.00
-
70.18
-
100.00
55.00
100.00
100.00
100.00
70.00
100.00
22.50
60.00
100.00
67.50
60.00
70.00
75.05
100.00
-
100.00
49.00
Name
Miller Avenue Pty Ltd
National Credit Insurance (Brokers) Pty Ltd and its subsidiaries
Network Insurance Group Pty Ltd and its subsidiaries
Newmarket Grandwest Pty Ltd and its subsidiaries
Newsure Insurance Brokers Pty Ltd
Onefocus Consolidated Pty Ltd and its subsidiaries (Formerly Asparq
Consolidated Pty Ltd)
Paramount Insurance Brokers Pty Ltd and its subsidiaries
Phoenix Insurance Brokers Pty Ltd
PID Holdings Pty Ltd and its subsidiaries
Pollard Advisory Services Pty Ltd2
QIB Group Holdings Pty Limited and its subsidiaries
Resolute Property Protect Pty Ltd
Risk Broking Pty Ltd and its subsidiary
Risk Partners Pty Limited
Rose Stanton Insurance Brokers Pty Ltd3
Scott & Broad Pty Ltd and its subsidiaries
Scott Winton Nominees Pty Ltd
Simplex Insurance Solutions Pty Ltd
SRB Management Pty Limited and its subsidiaries
Steadfast Distribution Services Pte Ltd
Steadfast NZ Holdings Limited
Steadfast NZ Limited
Steadfast Shared Services Pty Ltd
Steadfast Taswide Insurance Brokers Pty Ltd and its subsidiaries
Steadfast Workplace Risk Pty Ltd (Formerly Work Health Alternatives Pty Ltd)
Surefire Insurance Brokers Pty Ltd and its subsidiaries
Timjamway Pty Ltd
Trans-West Insurance Brokers (NSW) Pty Ltd (Formerly Unity Trade Credit
Pty Ltd)
Trident Insurance Group Pty Ltd
Tudor Insurance Agency Unit Trust
Webmere Pty Ltd and its subsidiaries
Whitbread Holdings Pty Ltd and its subsidiaries
Whitbread Life Pty Ltd
Woodleigh Fields Pty Ltd (trading as Breakwater Insurance Brokers)
II. Underwriting agency businesses
Steadfast Underwriting Agencies Holdings Pty Limited
Axis Underwriting Services Pty Ltd
Calliden Group Pty Ltd and its subsidiaries
CHU Underwriting Agencies Pty Ltd and its subsidiaries
Ownership interest
Country
of incorporation
2023
%
2022
%
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Singapore
New Zealand
New Zealand
Philippines
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
100.00
100.00
83.75
64.94
100.00
67.41
97.56
62.50
80.00
85.66
60.00
100.00
67.41
97.56
62.50
65.00
100.00
100.00
-
78.34
78.50
60.00
100.00
-
65.00
74.00
60.00
50.00
100.00
100.00
100.00
100.00
60.14
57.00
50.00
90.00
100.00
83.00
74.00
76.00
100.00
100.00
100.00
100.00
90.00
100.00
100.00
95.00
81.70
78.50
60.00
100.00
100.00
65.00
90.00
60.00
50.00
100.00
100.00
100.00
100.00
66.12
57.00
-
90.00
-
78.00
74.00
76.00
100.00
100.00
-
100.00
90.00
100.00
100.00
Steadfast Group Annual Report 2023 109
Notes to the financial statements continued
Name
Coast Insurance Pty Ltd (Formerly Hostsure Underwriting Agency Pty Ltd)
Emergence Insurance Group Pty Ltd and its subsidiaries
HMIA Pty Ltd
JMT Insurance Holdings Pty Ltd and its subsidiaries
Miramar Underwriting Agency Pty Limited
NM Insurance Pty Ltd and its subsidiaries
Platinum Placement Solutions Pty Ltd
Primassure (Australia) Pty Ltd
Procover Underwriting Agency Pty Ltd
Quanta Insurance Group Pty Ltd
Sports Underwriting Australia Pty Ltd
Steadfast Placement Solutions Pty Ltd
Country
of incorporation
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Steadfast Placement Solutions (UK) Ltd
United Kingdom
SUA Services Pty Ltd
Underwriting Agencies of Australia Pty Ltd and its subsidiaries
WM Amalgamated Pty Ltd and its subsidiary
III. Complementary businesses
Gold Seal I.P. Pty Ltd
Gold Seal Practice Management Pty Ltd
InsuranceConnect Pty Ltd4
Insurance Finance Group Pty Ltd
IQumulate Premium Funding Pty Ltd
Steadfast Business Solutions Pty Ltd
Steadfast Convention Pty Limited
Steadfast Foundation Pty Ltd
Steadfast INSIGHT Holdings Pty Ltd
Steadfast Risk Group Pty Ltd and its subsidiaries
Steadfast Share Plan Nominee Pty Ltd
Steadfast Technologies Group Holdings Pty Ltd
Steadfast Technologies NZ Limited
Steadfast Technologies Pty Ltd
Steadfast Technologies Shared Services Pty Ltd
Steadfast Technology Services NZ Limited
Steadfast Technology Services Pty Ltd
Steadfast UnderwriterCentral Holdings Pty Ltd5
Steadfast Virtual Underwriter Holdings Pty Ltd
UnisonSteadfast AG
1 Bill Owen Insurance Services Pty Ltd was acquired by QIB Group Holdings Pty Limited.
2 Pollard Advisory Services Pty Ltd was acquired by Insurance Brands Australia Pty Ltd.
3 Rose Stanton Insurance Brokers Pty Ltd was acquired by QIB Group Holdings Pty Limited.
4InsuranceConnect Pty Ltd was disposed outside the Group.
5 Steadfast UnderwriterCentral Holdings Pty Ltd Pty Ltd was disposed outside the Group.
110 Steadfast Group Annual Report 2023
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
New Zealand
Australia
Australia
New Zealand
Australia
Australia
Australia
Germany
Ownership interest
2023
%
51.00
50.00
70.80
79.99
100.00
90.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
88.33
100.00
100.00
100.00
-
100.00
90.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
-
100.00
60.00
2022
%
51.00
50.00
70.80
89.19
100.00
90.00
100.00
100.00
100.00
100.00
90.00
100.00
100.00
100.00
88.33
100.00
100.00
100.00
100.00
-
90.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
60.00
Note 12. Investments in associates and joint ventures
A. Details of associates and joint ventures
Interests in associates and joint ventures are accounted for using the equity method of accounting. Information relating to key
associates is set out below.
Ownership interest
Equity-accounted
Name
I. Insurance broking businesses
Ausure Group Pty Ltd – associates thereof
Baileys Insurance Limited1
Baileys Premium Funding Limited
Blackburn (Insurance Brokers) Pty Ltd and Liability Brokers
Pty Ltd
Collective Insurance Brokers Pty Ltd
Covercorp Pty Ltd
Coverforce HoldCo Pty Ltd - associates thereof
Fenchurch Insurance Brokers Pty Ltd2
Finpac Insurance Advisors Pty Ltd3
Insurance Brands Australia Pty Ltd – associates thereof
J.D.I. (Young) Pty. Limited
Johansen Insurance Brokers Pty Ltd
Listsure Pty Ltd
McKillops Insurance Brokers Pty Ltd
McLardy McShane Partners Pty Ltd and McLardy McShane
Insurance Brokers Pty Ltd
Melbourne Insurance Brokers Pty Ltd4
Origin Insurance Brokers Pty Ltd
Quattro Risk Services Pty Ltd - associates thereof5
Rothbury Group Limited and its subsidiaries
RSM Group Pty Ltd
Sapphire Star Pty Ltd
Southside Insurance Brokers Pty Ltd
Steadfast Eastern Insurance Brokers Pty Ltd6
Steadfast IRS Pty Ltd - associates thereof7
Steadfast Life Pty Ltd and its subsidiary
UnisonSteadfast AG - associates thereof
Watkins Insurance Brokers Pty Ltd and D&E Watkins Unit Trust
2023
%
20.82
58.50
40.00
40.00
49.00
49.00
24.58
72.50
-
20.00
25.00
48.35
29.80
49.00
37.00
61.00
49.00
-
43.39
49.00
30.00
49.00
62.50
-
50.00
30.00
35.00
2022
%
17.13
40.00
40.00
40.00
49.00
49.00
24.09
22.50
49.00
-
25.00
48.35
26.30
49.00
37.00
49.00
49.00
12.00
42.80
49.00
30.00
49.00
25.00
47.00
50.00
30.00
35.00
2023
$'m
2022
$'m
12.8
-
1.2
3.0
0.3
1.0
35.8
-
-
1.1
1.1
4.0
-
4.5
3.9
-
-
-
32.6
4.5
0.8
0.6
-
-
4.6
-
1.2
10.6
6.0
1.1
2.5
0.3
1.0
36.5
1.9
1.0
-
1.0
4.1
1.4
4.2
3.4
1.5
-
0.2
29.9
4.8
0.8
0.6
1.2
3.1
3.2
-
1.2
Steadfast Group Annual Report 2023 111
Notes to the financial statements continued
Name
II. Underwriting agency businesses
Community Broker Network Pty Ltd - associates thereof
QUS Pty Ltd
Sterling Insurance Pty Ltd
III. Complementary businesses
Flame Security International Pty Ltd
HJS Unit Trust
Meridian Lawyers Limited
IV. Joint ventures
Abbott NZ Holdings Limited - joint ventures thereof
Ausure Group Pty Ltd - joint ventures thereof
BAC Insurance Brokers Pty Ltd and its subsidiary
Blend Insurance Solutions Pty Ltd and its subsidiary
Coverforce HoldCo Pty Ltd - joint ventures thereof
Network Insurance Group Hospitality Pty Ltd - joint
ventures thereof
Steadfast Risk Group Pty Ltd - joint ventures thereof
Steadfast Technologies Group Holdings Pty Ltd - joint
ventures thereof
Ownership interest
Equity-accounted
2023
%
41.06
45.00
39.50
26.30
33.33
25.00
50.00
22.36
50.00
50.00
35.34
32.50
50.00
2022
%
37.09
45.00
39.50
26.30
33.33
25.00
50.00
22.36
50.00
50.00
33.65
30.00
50.00
50.00
50.00
2023
$'m
2022
$'m
2.9
0.4
5.0
23.8
2.0
2.5
0.4
5.2
11.9
0.9
52.0
2.2
0.1
0.2
1.1
0.8
4.9
7.2
1.8
2.3
0.4
4.4
11.5
1.7
47.1
3.5
1.8
0.2
1 Baileys Broking Ltd became a subsidiary in FY23 and is disclosed for comparative purposes.
2 Fenchurch Insurance Brokers Pty Ltd became a subsidiary in FY23 and is disclosed for comparative purposes.
3 Finpac Insurance Advisors Pty Ltd was acquired by a subsidiary of the Group during FY23. No direct interest has been retained.
4Melbourne Insurance Brokers Pty Ltd became a subsidiary in FY23 and is disclosed for comparative purposes.
5 Quattro Risk Services Pty Ltd disposed of its associate during FY23.
6 Steadfast Eastern Insurance Brokers Pty Ltd became a subsidiary in FY23 and is disclosed for comparative purposes.
7 Steadfast IRS Pty Ltd disposed of its associate during FY23.
112 Steadfast Group Annual Report 2023
B. Reconciliation of movements of associates and joint ventures
Balance at the beginning of the financial year
Additions - cash
Additions - non-cash
Additions - scrip issued
Step-up investment to subsidiaries
Disposals - cash
Other adjustments
Share of EBITA from associates and joint ventures
Less share of:
Finance cost
Amortisation expense
Income tax expense
Share of associates and joint ventures' profit after income tax
Dividends received/receivable
Impairment
Net foreign exchange movements
Balance at the end of the financial year
2023
$'m
210.3
13.1
16.9
-
(13.2)
(3.3)
(3.0)
220.8
43.6
(2.0)
(2.4)
(8.5)
30.7
(27.3)
(1.9)
0.3
222.6
2022
$'m
115.6
62.7
10.0
38.3
(13.8)
-
(0.7)
212.1
36.0
(0.7)
(2.3)
(7.1)
25.9
(26.9)
-
(0.8)
210.3
C. Summarised financial information of associates and joint ventures
I. Disclosure in aggregate
These disclosures relate to the investment in all associates and joint ventures in aggregate. The figures below represent the financial
position and performance of the associates and joint ventures as a whole and not just the Group’s share.
Current assets
Non-current assets
Current liabilities
Non-current liabilities
Net assets
Revenue
EBITA
Profit after income tax
Total comprehensive income
2023
$'m
451.0
191.7
(425.3)
(99.2)
118.3
311.7
74.6
46.8
46.8
2022
$'m
371.8
157.0
(347.2)
(73.3)
108.3
283.1
67.8
44.2
44.2
Steadfast Group Annual Report 2023 113
Notes to the financial statements continued
Note 13. Trade and other receivables
Trade and other receivables
Fee and commission receivable
Less: ECL (refer Note 14C)1
Net fee and commission receivable
Other receivables
1 $0.7 million of the increase in the ECL provision during the period is attributable to business acquisitions.
2 Comprises primarily trade receivables and accrued income.
Premium funding receivables
Premium funding receivables
Less: ECL (refer Note 14C)
Note 14. Financial instruments
A. Financial risk management objectives
2023
$'m
183.0
(4.9)
178.1
83.22
261.3
2023
$'m
663.4
(1.2)
662.2
2022
$'m
137.8
(3.6)
134.2
71.9
206.1
2022
$'m
576.9
(1.2)
575.7
The Group's activities expose it to a variety of financial risks: interest rate risk, credit risk and liquidity risk. The Group's overall risk
management framework focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on
the financial performance of the Group. The Group uses different methods to measure different types of risk to which it is exposed.
These methods include sensitivity analysis in the case of interest rate risk and ageing analysis for credit risk.
Financial risk management is carried out by senior finance executives (Finance) under policies approved by the Board. These policies
include identification and analysis of the risk exposure of the Group and appropriate procedures, controls and risk limits. Finance
identifies, evaluates and may hedge financial risks within the Group's operating units. Finance reports to the Board on a regular basis.
114 Steadfast Group Annual Report 2023
B. Market risk
Interest rate risk
As at the reporting date, the Group had the following variable rate bank accounts and borrowings:
Non-derivatives
Cash at bank
Cash on deposit
Bank overdrafts
Bank loans1
Premium funding borrowings
Derivatives
Interest rate swaps3
2023
Weighted
average
interest rate
%
2.43
3.52
-
5.682
6.172
2022
Weighted
average
interest rate
%
0.20
0.98
-
2.932
2.972
2023
Balance
$'m
834.8
303.7
(0.5)
(518.8)
(452.2)
167.0
2022
Balance
$'m
769.2
175.8
-
(419.6)
(466.9)
58.5
2.80
(62.5)
1.98
(212.5)
1 Balances include principal and outstanding interest payable effective 30 June 2023.
2 Weighted average interest rate excludes any applicable line fee paid to lenders.
3 The Group entered into two interest rate swaps, with face values of $150.0 million and $62.5 million, where BBSY indexed floating rate payments were swapped for
1.84450% and 2.29875% fixed rate payments respectively. The $150.0 million face value swap matured in January 2023 and the remaining $62.5 million swap will mature
in January 2025. The Group entered into the interest rate swaps to minimise the Group’s exposure to interest rate risk by the Group agreeing to exchange the difference
between fixed and variable rate interest amounts calculated by reference to an agreed-upon face value. The swaps are designed to hedge interest costs associated
with the underlying corporate debt obligations. At 30 June 2023, after taking into account the effect of the interest rate swaps, approximately 85.7% of the Group’s
corporate debt is exposed to variable rates (2022: 37.3%).
An increase/decrease in interest rates of 100 (2022: 100) basis points would have the following effect on profit/(loss) after tax:
Increase of 100 basis points: $1.6 million favourable per annum (2022: $0.4 million favourable)
Decrease of 100 basis points: $1.6 million unfavourable per annum (2022: $3.9 million favourable).
The basis point change is based on the expected volatility of interest rates using market data, historical trends over prior years and
the Group's ongoing relationships with financial institutions.
C. Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Group.
The Group obtains guarantees where appropriate to mitigate credit risk. The maximum exposure to credit risk at the reporting
date to recognised financial assets is the carrying amount (net of any provisions for impairment of those assets) as disclosed in
the statement of financial position and notes to the financial statements. The Group does not hold any collateral, except for the
collateral specified in relation to loans to facilitate management buy-ins as described below.
Credit risk of the Group mainly arises from cash and cash equivalents, and trade and other receivables.
The Group has funded $36.1 million (2022: $31.9 million) of loans to facilitate management buy-ins to certain businesses under
the Group’s owner-driven business model. These loans are disclosed as other non-current assets in the consolidated statement of
financial position. These loans attract commercial interest rates, with dividends from these businesses used to fund interest and
loan repayments. The shares held by management in those businesses are provided as loan collateral.
The Group’s exposure to credit risk is concentrated in the financial services industry with parties that are considered to be of
sufficiently high credit quality (including cash held with major Australian banks) to minimise credit risk losses. Receivables include
amounts due from policyholders in respect of insurances arranged by controlled entities. The Group assumes that the credit risk on
fee and commission receivable increases significantly if outstanding 90 days past credit due terms. An ECL provision is recognised
in respect of fee and commission receivable.
Steadfast Group Annual Report 2023 115
Notes to the financial statements continued
The Group also has exposure to credit risk from premium funding loans. The ECL provision for premium funding loans is based on
historical data as a percentage of total loans written, after expected recoveries from trade credit policies.
The following table shows the movement in ECL that has been recognised for fee and commission receivable and premium funding
receivables in accordance with the simplified approach set out in AASB 9:
ECL - Fee & commission receivables
Balance at the beginning of the financial year
Increase in ECL
Additions through business combinations
Balance at the end of the financial year
ECL - Premium funding receivables
Balance at the beginning of the financial year
Decrease in ECL
Balance at the end of the financial year
D. Liquidity risk
2023
$'m
3.6
0.6
0.7
4.9
2023
$'m
1.2
-
1.2
2022
$'m
3.1
0.2
0.3
3.6
2022
$'m
2.0
(0.8)
1.2
Vigilant liquidity risk management requires that the Group maintains sufficient liquid assets to be able to pay debts as and when they
become due and payable and satisfy each AFSL holders' requirements. For both the Group’s insurance intermediaries and premium
funders, this is largely achieved by maintaining sufficient cash reserves in the forms of cash and cash equivalents and available
borrowing facilities.
The Group manages liquidity risk by maintaining adequate cash reserves and available borrowing facilities, continuously monitoring
actual and forecast cash flows, and by matching the maturity profiles of financial assets and liabilities.
For the Group’s premium funders, liquidity risk is mitigated by allocating premium funding to a diverse range of corporate and SME
businesses, limiting the majority of premium funding loans to no more than 11 monthly instalments, minimising the life cycle of
funds in use, retaining adequate levels of available funds to safeguard against exceeding facility limits, and by matching the maturity
profile of current and prospective financial assets against available funding limits.
The following tables detail the Group's remaining contractual maturity for its financial liabilities. The tables have been drawn up
based on the undiscounted cash flows of financial liabilities based on the earliest date on which the financial liabilities are required
to be paid.
116 Steadfast Group Annual Report 2023
2023
Non-derivatives
I. Non-interest bearing
Payables on
broking/underwriting
agency operations
Trade and other payables
Premium funding payables
Deferred consideration
II. Interest bearing
Bank loans
Premium
funding borrowings
Total non-derivatives
Derivatives
Hedge interest rate swaps
(net settled)
Total derivatives
2022
Non-derivatives
I. Non-interest bearing
Payables on
broking/underwriting
agency operations
Trade and other payables
Premium funding payables
Deferred consideration
II. Interest bearing
Bank loans
Premium
funding borrowings
Total non-derivatives
Derivatives
Hedge interest rate swaps
(net settled)
Total derivatives
Weighted
average interest
rate
%
1 year or less
$'m
1 to 2 years
$'m
2 to 5 years
$'m
Over 5 years
$'m
Total
contractual
maturities
$'m
868.3
161.8
206.4
86.5
-
-
-
24.3
-
-
-
1.5
5.68
6.17
4.5
265.4
258.4
48.5
1,376.0
-
289.7
431.6
691.5
(2.5)
(2.5)
(2.0)
(2.0)
648.7
121.4
139.5
51.9
10.5
33.0
1,005.0
(0.3)
(0.3)
-
-
-
15.7
8.4
-
24.1
-
-
-
-
-
-
-
-
396.1
447.7
843.8
-
-
2.93
2.97
-
-
-
-
20.0
-
20.0
-
-
-
-
-
-
16.9
-
16.9
-
-
868.3
161.8
206.4
112.3
548.3
480.1
2,377.2
(4.5)
(4.5)
648.7
121.4
139.5
67.6
431.9
480.7
1,889.8
(0.3)
(0.3)
Steadfast Group Annual Report 2023 117
Notes to the financial statements continued
Note 15. Contingencies
Contingent liabilities
Macquarie Bank put options
The Group has granted options to Macquarie Bank Limited (Macquarie) to enable Macquarie to put shares held by other shareholders
in associates and controlled entities of the Group at fair value if Macquarie enforces its security over those shares. These have been
granted in relation to shares held by other shareholders in associates and controlled entities over which Macquarie holds a security
interest to secure indebtedness by those shareholders. The Group expects no material net exposure from this arrangement as the
contingent liabilities have contingent assets (being rights to shares held by the relevant shareholders) of similar values.
Bank guarantee
In the normal course of business, certain controlled entities in the Group have provided security for bank guarantees principally in
respect of their contractual obligations on commercial leases.
Other
In the normal course of business, the Group is also exposed to contingent liabilities (net of any recoveries) in relation to litigation
arising out of its activities. The Group may also be exposed to the possibility of contingent liabilities in relation to litigation including
but not limited to regulatory test cases and class actions, taxation and compliance matters which may result in legal or regulatory
penalties and financial or non-financial losses and other impacts.
Note 16. Events after the reporting period
Final dividend
On 16 August 2023, the Board declared a final dividend for FY23 of 9.0 cents per share, fully franked. The dividend will be paid on
21 September 2023.
Facility extension
The Group had a $660.0 million multibank syndicated facility with a combination of three year and five year tranches. At balance
date, the Group had the ability to borrow a further $216.6 million from this facility.
Subsequent to the balance date, this facility was increased to $860.0 million and extended as follows:
two revolving tranches totalling $385.0 million, maturing August 2026;
two fixed-term tranches totalling $175.0 million, maturing August 2026;
a $200.0 million fixed-term tranche, maturing November 2026; and
a $100.0 million fixed-term tranche, maturing August 2028.
IQumulate Premium Funding Warehouse Trust extension
At 30 June 2023, the Warehouse Trust limit for IQumulate Premium Funding Pty Ltd was $570.0 million (including a $60.0 million
overdraft facility). In July 2023, the Warehouse Trust limit was increased by $90.0 million to $660.0 million (including a $60.0 million
overdraft facility) with an extended availability period to July 2024.
Note 17. Share-based remuneration
Share-based payments – employee related
Share-based remuneration encourages employee share ownership, links employee reward to the performance of the Group and
assists with attracting, retaining and motivating highly qualified and key personnel.
The Company intends to settle its obligations under share-based payment arrangements by the on-market purchase of the
Company’s ordinary shares which will be held in trust pending exercise of vested rights by employees. The Group has established
a practice of purchasing a tranche of shares on or near grant date at the prevailing market price to facilitate building up a portfolio
sufficient to meet the obligations when rights vest.
Trading in the Company’s ordinary shares awarded under the share-based remuneration arrangements is covered by the same
restrictions that apply to all forms of share ownership by employees. These restrictions prohibit an employee trading in the
Company’s ordinary shares when they are aware of price sensitive information and limit their trading at other times.
118 Steadfast Group Annual Report 2023
The Group has the following types of share-based remuneration arrangements provided to employees; each arrangement has
different purposes and different rules:
short-term incentive (STI) plan;
long-term incentive (LTI) plan; and
sign on bonus.
The share-based payments are included in the employment expense line in the statement of profit or loss and other
comprehensive income.
Senior management and executive share plans
The senior management and executive share plan arrangements are awarded based on the terms and conditions as set out in the
STI and LTI plans. When granted, the awards in these two plans may be in the form of cash and/or rights. The Board has approved the
participation of each individual in these arrangements as well as the actual awards based on the performance conditions in these
two plans being met.
A. STI
The STI plan is a discretionary, performance-based, at-risk reward arrangement. STI is awarded based on each participant’s
performance hurdles and the achievement of a minimum 11.35% underlying ROC (FY22: 12.2%) defined as underlying NPAT
(adjusted to remove impact of the IBA acquisition in FY23 and Coverforce acquisition in FY22) as a percentage of opening
shareholders' equity attributable to the owners of Steadfast Group Limited.
The key terms of the STI plan for the 2023 financial year are:
total STI will be awarded and settled in the form of cash and rights as approved by the Board if ROC and individual participant’s
performance criteria for the performance period (i.e. 1 July to 30 June) are met. If met:
60% of STI will be settled in the form of cash and will be paid in August after the performance period; and
40% of STI awarded will be deferred and granted in the form of rights;
rights are granted for nil consideration;
the vesting condition of rights is not market related and requires the participant to continue in relevant employment from the
grant date of the rights (retention period) to the vesting date, being one year after grant date;
the rights will accrue notional dividends during the retention period;
when vesting (after completion of the retention period), each right will be converted into one Steadfast ordinary share for nil
consideration upon exercise by the participant. The notional dividends will be converted into an equivalent number of Steadfast
ordinary shares based on the DRP issue price applicable to each dividend;
the Board has discretion to settle the rights in cash instead of Steadfast ordinary shares;
the vesting is conditional on there being no material deterioration in the FY23 reported results during the performance period
before the exercise of the rights; and
if the vesting condition is not met then the rights lapse.
Further details of the 2023 STI in relation to the Group’s KMP are disclosed in the Remuneration Report.
B. LTI
The LTI plan is a discretionary, performance-based, at-risk reward arrangement. LTI is awarded based on each participant’s
performance hurdles and the achievement of the minimum diluted EPS growth and TSR performance hurdles.
The key terms of the LTI plan for the 2023 financial year are:
LTI will be awarded in the form of rights as approved by the Board and will be granted in August following the end of each
financial year;
rights are granted for nil consideration;
the vesting condition of rights is conditional on meeting the following performance hurdles:
the participants meeting their individual performance hurdles during the three-year employment tenure from the grant date
of the rights (retention period);
50% (FY22: 50%) based on the Group achieving a minimum 8.5% (maximum at 12.25%) average straight line per annum diluted
EPS growth during the retention period; and
Steadfast Group Annual Report 2023 119
Notes to the financial statements continued
50% (FY22: 50%) based on the Group achieving a minimum TSR above the 50th percentile (maximum at 75th percentile) of the
peer group during the retention period;
the rights will not accrue notional dividends during the retention period;
before vesting, the Board will determine the number of rights to vest based on the combined outcome of the
performance hurdles;
when vesting (after completion of the retention period), each right will be converted into one Steadfast ordinary share for nil
consideration upon exercise by the participant;
the Board has discretion to settle the rights in cash instead of Steadfast ordinary shares;
the vesting is conditional on there being no material deterioration in the FY23 reported results during the performance period
before the exercise of the rights; and
if the vesting conditions are not met then the rights lapse.
Further details of the 2023 LTI in relation to the Group’s KMP are disclosed in the Remuneration Report.
Employee share plan
The Short-Term Employee Incentive Plan (STEIP) is a discretionary, performance based at-risk reward arrangement for employees
other than senior management and executives that aims to recognise the contributions of the eligible employees of the Group
when outstanding financial results and individual performance objectives are achieved.
The 2023 STEIP consists of two potential reward components:
cash component – a cash award which may be delivered if ROC targets are met; and
deferred equity component – a DEA of rights to Steadfast shares if ROC targets are met and subject to a tenure hurdle and no
material deterioration in ROC. Participation in the DEA component of the STEIP is by invitation only and is limited to participants
approved by the Group Managing Director & CEO.
The ROC growth targets for the STEIP are aligned with those in the senior management and executive STI plan.
Notional dividends on the rights will accrue during the tenure hurdle period from the first interim dividend after the grant date. The
notional dividends will be calculated in accordance with the DRP as varied from time to time. The accrued value of notional dividends
will be provided to a participant on the vesting date of a conditional right in the form of additional Steadfast shares (or cash in lieu).
120 Steadfast Group Annual Report 2023
Note 18. Taxation
A. Income tax (expense)/benefit
Profit before income tax expense
Income tax expense at statutory tax rate
Tax effect of difference in corporate tax rates in foreign jurisdictions
Tax effect of amounts that are not (deductible)/taxable in calculating taxable income
Share of after-tax profits of associates and joint ventures
Non-assessable and other deductible items
Non-deductible and other assessable items
Under/(over) provision for income tax in prior periods
Income tax expense
B. Major components of income tax expense
Current tax
Movement in deferred tax assets
Movement in deferred tax liabilities
C. Income tax on items recognised directly in equity
Deferred tax assets
Deferred tax liabilities
2023
$'m
337.6
(101.3)
0.3
5.7
52.5
(67.2)
0.2
(109.8)
(116.9)
1.6
5.5
(109.8)
1.4
-
1.4
2022
$'m
279.2
(83.8)
0.4
5.2
58.2
(58.3)
(1.5)
(79.8)
(77.1)
(1.5)
(1.2)
(79.8)
1.9
(0.2)
1.7
Steadfast Group Annual Report 2023 121
Notes to the financial statements continued
2023
$'m
2022
$'m
D. Deferred tax assets
I. Composition
Accrued expenses
Provisions
Deferred income
Business related capital costs
Leases
Other
II. Movements
Balance at the beginning of the financial year
Add: reversal of offset against deferred tax liabilities
Gross balance at the beginning of the financial year
Opening balance adjustments
Charged to profit or loss
Charged to equity
Additions through business combinations
Disposals
Balance at the end of the financial year before offset
Less: offset against deferred tax liabilities
Balance at the end of the financial year
E. Deferred tax liabilities
I. Composition
Intangible assets
Receivables and investments
Asset revaluation
Other
II. Movements
Balance at the beginning of the financial year
Add: reversal of offset against deferred tax assets
Gross balance at the beginning of the financial year
Charged to profit or loss
Charged to equity
Additions through business combinations
Disposals
Balance at the end of the financial year before offset
Less: offset against deferred tax assets
Balance at the end of the financial year
122 Steadfast Group Annual Report 2023
16.0
15.8
14.6
6.7
2.0
9.2
64.3
29.4
27.4
56.8
-
1.6
1.4
4.6
(0.1)
64.3
(28.8)
35.5
91.2
65.0
6.5
0.4
163.1
98.0
27.4
125.4
(5.5)
1.3
44.0
(2.1)
163.1
(28.8)
134.3
12.9
13.5
12.1
9.6
2.0
6.7
56.8
23.5
29.3
52.8
0.4
(1.5)
1.9
6.5
(3.3)
56.8
(27.4)
29.4
66.4
53.7
5.2
0.1
125.4
65.0
29.3
94.3
1.2
(0.2)
35.0
(4.9)
125.4
(27.4)
98.0
F. Tax transparency reporting
The Australian Taxation Office (ATO) publishes total income, taxable income and tax payable in relation to large taxpayers, with the
2021 financial year being the latest information released. The information published is sourced from the income tax return lodged
by Steadfast Group Limited as the head company of the Australian tax consolidated group (which captures only the entities that
are 100% owned by the Group).
Total income includes all Australian income, including commission and fee income, investment return and dividends. It does not
include any business expenses such as commission and fees expense, salaries or other operating expenses.
Taxable income is the net profit that is subject to tax and takes into account allowable deductions for business expenses and other
tax concessions, including non-taxable dividends from foreign subsidiaries.
Tax payable on taxable income is calculated with reference to the Australian corporate tax rate of 30%, adjusted for franking credits
and other tax concessions. On release of the 2022 financial year tax information, we envisage the following will be reported:
Total income
Taxable income
Tax paid by head entity
Effective tax rate
2022
$'m
746.5
198.3
26.6
2021
$'m
533.0
158.5
16.0
13.41%
10.09%
The most significant reason for the low effective tax rate for the parent entity is that a substantial portion of its disclosed taxable
income is dividends received and the attached franking credits (derived from those entities paying tax) reduce the tax payable by
the head entity.
For a complete view of the effective tax rate, the following needs to be considered:
Tax paid by head entity
Tax paid by investees (and passed to head entity as franking credits)
Underlying tax paid
Taxable income
Effective tax rate (excl. franking credits)
2022
$'m
26.6
32.9
59.5
198.3
30%
2021
$'m
16.0
31.6
47.6
158.5
30%
The 2023 income tax return for Steadfast Group Limited is expected to have an effective rate continuing at circa 30%.
Steadfast Group Annual Report 2023 123
Notes to the financial statements continued
Note 19. Notes to the statement of cash flows
A. Composition
Cash and cash equivalents
Cash held on trust
B. Reconciliation of profit after income tax to net cash from operating activities
Profit after income tax expense for the year
Adjustments for
Depreciation, amortisation and gain/loss on disposal of property, plant and equipment
Share of profits of associates and joint ventures
Income taxes paid
Dividends received from associates/joint ventures
Fair value loss/(gain) on listed investments
Net gain from investments
Share-based payments and incentives accruals
Impairment expense
Interest income on loans
Capitalised interest on loans
Change in operating assets and liabilities
Increase in trade and other receivables
(Increase)/decrease in deferred tax assets
Increase in other assets
Increase in trade and other payables
Increase in income tax payable
(Decrease)/increase in deferred tax liabilities
(Decrease)/increase in other liabilities
Increase in provisions
Net cash from operating activities
124 Steadfast Group Annual Report 2023
2023
$'m
259.2
879.3
1,138.5
2022
$'m
279.8
665.2
945.0
2023
$'m
2022
$'m
227.8
199.4
88.3
(30.7)
(105.6)
27.3
2.4
(23.4)
(6.1)
19.7
(0.6)
4.5
(33.5)
(1.6)
(5.7)
148.0
116.9
(5.5)
(3.5)
5.8
73.3
(25.9)
(77.0)
26.9
(2.3)
(9.3)
(5.4)
3.6
(0.4)
1.8
(24.8)
1.5
(2.9)
4.5
77.1
1.2
0.1
6.3
424.5
247.7
Note 20. Related party transactions
A. Key management personnel compensation
The aggregate remuneration received/receivable by KMP of the Group is set out as follows:
Short-term benefits
Post-employment benefits
Long-term benefits
Accrued share-based expenses
B. Transactions with subsidiaries
2023
$'000
7,552
224
105
5,130
13,011
2022
$'000
7,434
202
74
4,460
12,170
All transactions that have occurred among the subsidiaries within the Group have been eliminated on consolidation.
C. Transactions with other related parties
The following transactions occurred with related parties:
I. Sale of goods and services
Professional services fees received from associates and joint ventures on normal commercial terms
Commission income received/receivable from associates and joint ventures on normal
commercial terms
Professional service fees received by Director's related entities on normal commercial terms
2023
$'000
2022
$'000
210
205
22
210
1,499
16
II. Payment for goods and services
Commission expense paid/payable to associates on normal commercial terms
Professional service fees paid to associates and joint ventures
15,542
1,563
12,466
545
III. Receivable from and payable to related parties
The following balances are outstanding at the reporting date in relation to transactions with
related parties:
a. Current receivables
Receivables from associates and joint ventures
Trade receivables from Director's related entities
b. Current payables
Payables to associates and joint ventures
IV. Loans to/from related parties
Loans to associates and joint ventures - current
Loans to associates and joint ventures - non-current
151
9
422
25
3,590
2,577
152
5,882
-
3,391
Steadfast Group Annual Report 2023 125
Notes to the financial statements continued
Note 21. Parent entity information
The financial information provided in the table below is only for Steadfast Group Limited, the parent entity of the Group.
A. Statement of comprehensive income
Profit after income tax
Other comprehensive income / (loss)
Total comprehensive income
B. Statement of financial position
Current assets
Total assets
Current liabilities
Total liabilities
Net assets
Total equity of the parent entity comprising:
Share capital
Share-based payments reserve
Retained earnings
Revaluation reserve
Other reserves
Total equity
C. Significant accounting policies
2023
$'m
185.5
3.0
188.5
2023
$'m
159.5
2022
$'m
127.0
(0.3)
126.7
2022
$'m
95.5
2,661.0
2,180.6
89.6
535.9
2,125.1
70.9
417.5
1,763.1
1,949.0
1,638.9
13.4
147.6
12.1
3.0
11.4
100.7
12.1
-
2,125.1
1,763.1
The accounting policies of the parent entity are consistent with those of the Group, as disclosed in Note 2, except for investments in
subsidiaries, associates and joint ventures which are accounted for at cost, less any impairment. Dividends received are recognised
as income by the parent entity.
D. Going concern
The parent entity financial statements have been prepared on a going concern basis.
E. Contingent assets/liabilities not considered remote
The Company is exposed to the contingent assets and liabilities pertaining to the Macquarie Bank put options and other
contingencies set out in Note 15.
F. Parent entity capital commitments for acquisition of property, plant and equipment
The parent entity had no capital commitments for property, plant and equipment at 30 June 2023 and 30 June 2022.
G. Parent entity guarantees in respect of the debts of its subsidiaries
The parent entity provided no guarantees in relation to the debts of its subsidiaries at 30 June 2023 and 30 June 2022.
126 Steadfast Group Annual Report 2023
Note 22. Remuneration of auditors
A. KPMG
I. Audit and review services
Audit and review of financial statements - Group
Audit and review of financial statements - controlled entities
II. Assurance services
Regulatory assurance services
Other assurance services
III. Other services
Taxation advice and tax compliance services
Other services
B. Other auditors
I. Audit and review services
Audit and review of financial statements
II. Assurance services
Regulatory assurance services
Other assurance services
III. Other services
Taxation advice and tax compliance services
Other services
2023
$'000
2022
$'000
856
2,046
2,902
162
90
252
29
227
256
858
1,469
2,327
72
6
78
127
80
207
2023
$'000
2022
$'000
862
508
16
33
49
186
58
244
40
4
44
45
-
45
Steadfast Group Annual Report 2023 127
Steadfast Group Limited
Directors' declaration
1. In the opinion of the Directors of Steadfast Group Limited (the Company):
a. the consolidated financial statements and notes that are set out on pages 78 to 127 and the Remuneration Report in the
Directors’ Report, are in accordance with the Corporations Act 2001, including:
i. giving a true and fair view of the Group’s financial position as at 30 June 2023 and of its performance for the financial year
ended on that date; and
ii. complying with Australian Accounting Standards and the Corporations Regulations 2001; and
b. there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due
and payable.
2. The Directors have been given the declarations required by Section 295A of the Corporations Act 2001 from the Chief Executive
Officer and Chief Financial Officer for the financial year ended 30 June 2023.
3. The Directors draw attention to Note 2A to the consolidated financial statements, which includes a statement of compliance with
International Financial Reporting Standards.
Signed at Sydney on 16 August 2023 in accordance with a resolution of the Directors:
Frank O’Halloran, AM
Chair
Robert Kelly, AM
Managing Director & CEO
128 Steadfast Group Annual Report 2023
Steadfast Group Annual Report 2023 129
KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation. Liability limited by a scheme approved under Professional Standards Legislation. Independent Auditor’s Report To the shareholders of Steadfast Group Limited Report on the audit of the Financial Report Opinion We have audited the Financial Report of Steadfast Group Limited (the Company). In our opinion, the accompanying Financial Report of the Company is in accordance with the Corporations Act 2001, including: • giving a true and fair view of the Group’s financial position as at 30 June 2023 and of its financial performance for the year ended on that date; and • complying with Australian Accounting Standards and the Corporations Regulations 2001. The Financial Report comprises: • Consolidated statement of financial position as at 30 June 2023 • Consolidated statement of profit or loss and other comprehensive income, Consolidated statement of changes in equity, and Consolidated statement of cash flows for the year then ended • Notes including a summary of significant accounting policies • Directors’ Declaration The Group consists of the Company and the entities it controlled at the year-end or from time to time during the financial year. Basis for opinion We conducted our audit in accordance with Australian Auditing Standards. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the Financial Report section of our report. We are independent of the Group in accordance with the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code) that are relevant to our audit of the Financial Report in Australia. We have fulfilled our other ethical responsibilities in accordance with these requirements. Key Audit Matters The Key Audit Matters we identified are: • Valuation of Goodwill, Intangible assets and Investments in associates and joint ventures; • Acquisition accounting for Insurance Brands Australia Pty Ltd; and • Decentralised operations. Key Audit Matters are those matters that, in our professional judgement, were of most significance in our audit of the Financial Report of the current period. These matters were addressed in the context of our audit of the Financial Report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. 130 Steadfast Group Annual Report 2023
Valuation of Goodwill, Intangible assets, and Investments in associates and joint ventures Refer to Note 7: Goodwill ($1,985.7m) and Other intangible assets ($346.6m), Note 12: Investments in associates and joint ventures ($222.6m), and Note 3: Critical accounting judgements, estimates and assumptions The key audit matter How the matter was addressed in our audit The valuation of Goodwill, Intangible assets, and Investments in associates and joint ventures is a key audit matter given the: • Size of the balance (being 52% of the Group’s total assets). • High number of individual Cash Generating Units (CGUs), of more than 89 at 30 June 2023. This necessitated our consideration of the Group’s determination of CGUs and increases the complexity in the Group’s valuation for each of the CGUs, intangible assets and investments in associates and joint ventures. • Impairment of $19.7m recognised by the Group during the financial year. • Forward-looking and judgemental assumptions applied by the Group in its valuation for each of the CGUs, including: − Forecast cash flows, revenue and expense growth assumptions, terminal value growth rates and earnings multiples which are influenced by subjective drivers and rely on the Group’s expectation of future customer activity and insurance market developments; and − Discount rates, which are complicated in nature and can vary according to the underlying economic conditions. The Group engaged an external expert to assist in determining the discount rates. We involved valuation specialists to supplement our senior audit team members in assessing this key audit matter. Our procedures included: • Assessing the Group’s determination of CGUs based on our understanding of the operation of the Group’s businesses, and how independent cash flows were generated, against the requirements of the accounting standards. • Assessing the Group’s analysis of indicators of impairment of intangible assets and its investments in associates and joint ventures based on actual business performance and approved forecasts. Working with our valuation specialists, our procedures included: • Considering the appropriateness of the valuation methods applied (value in use and fair value less costs of disposal) by the Group against the requirements of the accounting standards. • Comparing the forecast cash flows contained in the valuation models to the Board approved budgets. We also evaluated the forecasting process undertaken by the Group and assessed the precision of prior year forecast cash flows by comparison to actual outcomes. • Applying increased professional scepticism to forecast cash flows in the areas where previous forecasts were not achieved. We compared the revenue and expense growth assumptions and terminal value growth rate assumptions to recent external data on inflation rates as an indicator of future customer activity and projected insurance market premium growth in Australia. We used our knowledge of the Group, its past performance, business and customers, and our general insurance industry experience in considering the feasibility of the forecasts used. • Independently developing a range of discount rates and earnings multiples considered comparable based on analysis of comparable companies using publicly available market data, adjusted by risk factors specific to the Group and the industry it operates in. • Performing sensitivity analysis by varying key assumptions, such as forecast growth rates, terminal value growth rates, discount rates and earnings Steadfast Group Annual Report 2023 131
multiples within a reasonably possible range, for all CGUs. We did this to identify those CGUs at higher risk of impairment, assumptions at higher risk of bias, and to focus our further audit procedures. Additionally, we cross checked the valuation results against earnings multiples based on the value of other comparable companies. • Assessing the integrity of the valuation models used, including accuracy of the underlying calculations, agreeing key inputs to relevant sources and recalculating the impairment charge. • We assessed the disclosures in the financial report using our understanding obtained from our testing, and against the requirements of the accounting standards. Acquisition accounting for Insurance Brands Australia Pty Ltd Refer to Note 10: Business combinations ($311.9m) The key audit matter How the matter was addressed in our audit The Group acquired Insurance Brands Australia Pty Ltd (IBA) for consideration of $311.9m on 17 August 2022. The acquisition accounting associated with this transaction is a key audit matter given: • The financial significance of the transaction for the Group. • The determination of fair value of acquired intangible assets and goodwill are sensitive to changes in judgemental assumptions. This drives additional audit effort to assess the feasibility of these assumptions and the methods used. Areas of focus included the: − Assessment of the completion date; − Fair value of the acquired customer contract intangible assets at the acquisition date, including focus on the discount rate and client attrition rates as the key assumptions; and − Fair value of the identifiable assets and liabilities as part of the acquisition. The Group engaged an external valuation expert to assist with the identification and measurement of acquired assets and liabilities and the purchase price allocation to goodwill and separately Our procedures included: • Reading the transaction documents related to the acquisition to understand the structure, key terms and conditions. Using this, we evaluated the accounting treatment of the acquisition against the criteria of a business combination in the accounting standards. • Working with our technical accounting specialists to assess whether the Group’s determination of the completion date was in accordance with the accounting standards. Working with our valuation specialists, our procedures included: • Evaluating the Group’s external valuation expert’s objectivity, competence and scope of work with respect to their involvement in the determination of fair value of acquired customer contract intangible assets and the purchase price allocation to goodwill and other separately identifiable intangible assets. • Assessing the valuation methodologies against accepted industry practice and the requirements of the accounting standards. • Comparing specific assumptions (such as revenue and expense growth assumptions) used by the Group’s external valuation expert to Board approved business forecasts and publicly available industry 132 Steadfast Group Annual Report 2023
identifiable intangible assets. We involved valuation specialists to supplement our senior audit team members in assessing this key audit matter. growth rates. • Challenging the Group’s judgmental assumptions related to the fair value of separately identifiable intangible assets including discount rates, client attrition rates and forecasted cashflows. We did this by comparing these assumptions to publicly available market data and valuations from comparable transactions. • Checking the goodwill balance recognised as a result of the transaction and comparing it to the goodwill amount recorded by the Group. • Assessing the disclosures in the financial report, by comparing these to our understanding of the acquisitions obtained from our testing and the requirements of the accounting standards. Decentralised operations Refer to Note 2: Significant accounting policies, Note 11: Subsidiaries, and Note 12: Investments in associates and joint ventures The key audit matter How the matter was addressed in our audit The Group comprises more than 155 subsidiaries, associates and joint ventures (components) whose operations are spread across Australia, New Zealand, and to a lesser degree, the United Kingdom, Singapore and Germany. The individual components are wide ranging in size, and the customers and products of each business operation vary. The decentralised and varied nature of these operations requires significant oversight by the Group to monitor the activities, review component financial reporting, and undertake the Group consolidation. This is an extensive process due to the variety of accounting processes and systems used by each component across the Group. This is a key audit matter given: • The number of subsidiaries, associates and joint ventures and the varied operations, accounting processes and systems across the Group. • The level of senior audit team member effort involved to: − Understand the components and identify the significant risks of misstatement within each component; Our procedures included: • Instructing component audit teams to perform procedures on the financial information prepared for consolidation purposes by 36 components. The selected components covered over 84% of the Group’s revenue and 84% of total assets. The objective of this approach was to gather evidence on significant balances that aggregate to form a large part of the Group’s financial reporting. • The component audit teams performed audits of the financial information of these components which included specific Group reporting package information and local statutory financial reporting. We worked with the component audit teams to identify risks significant to the audit of the Group and to plan relevant procedures. • Discussing with component audit teams the component audits as they progressed to identify and address any issues. • Reading the audit reports issued to us and the underlying memos to evaluate the work performed by the component audit teams for adequacy with the overall Group audit purpose. This included the components compliance with the Group’s accounting policies, including those relating to the recognition of Steadfast Group Annual Report 2023 133
− Scope relevant audit procedures consistent with the risks identified and to enable sufficient appropriate audit evidence over the significant aggregated balances at the Group; − Assess components compliance with the Group accounting policies; and − Audit the consolidation process and aggregation of results from component audit team procedures. revenue. • Testing the financial data used in the consolidation process for consistency with the financial data audited by component audit teams. We also assessed the consolidation process for compliance with the accounting standards. • For selected components, inspecting the component auditors’ files for consistency between the auditor’s opinion and the underlying audit work. • For the other components not within the scope of component audit teams’ procedures, our head office audit procedures included testing the Group’s key monitoring controls and performance of analytical procedures. We inspected a sample of bank reconciliations, debtors’ reports, statutory financial reports, and accompanying audit reports, and inquired with head office management. In our analytical procedures, we compared actual financial results to budgets and the prior year results. We inquired of head office and considered trends within the insurance market. Other Information Other Information is financial and non-financial information in Steadfast Group Limited’s annual reporting which is provided in addition to the Financial Report and the Auditor’s Report. The Directors are responsible for the Other Information. Our opinion on the Financial Report does not cover the Other Information and, accordingly, we do not express an audit opinion or any form of assurance conclusion thereon, with the exception of the Remuneration Report and our related assurance opinions. In connection with our audit of the Financial Report, our responsibility is to read the Other Information. In doing so, we consider whether the Other Information is materially inconsistent with the Financial Report or our knowledge obtained in the audit, or otherwise appears to be materially misstated. We are required to report if we conclude that there is a material misstatement of this Other Information, and based on the work we have performed on the Other Information that we obtained prior to the date of this Auditor’s Report we have nothing to report. Responsibilities of the Directors for the Financial Report The Directors are responsible for: • preparing the Financial Report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001; • implementing necessary internal control to enable the preparation of a Financial Report that gives a true and fair view and is free from material misstatement, whether due to fraud or error; and • assessing the Group and Company’s ability to continue as a going concern and whether the use of the going concern basis of accounting is appropriate. This includes disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless they either intend to liquidate the Group and Company or to cease operations, or have no realistic alternative but to do so. 134 Steadfast Group Annual Report 2023
Auditor’s responsibilities for the audit of the Financial Report Our objective is: • to obtain reasonable assurance about whether the Financial Report as a whole is free from material misstatement, whether due to fraud or error; and • to issue an Auditor’s Report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error. They are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the Financial Report. A further description of our responsibilities for the audit of the Financial Report is located at the Auditing and Assurance Standards Board website at https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf. This description forms part of our Auditor’s Report. Report on the Remuneration Report Opinion In our opinion, the Remuneration Report of Steadfast Group Limited for the year ended 30 June 2023 complies with Section 300A of the Corporations Act 2001. Directors’ responsibilities The Directors of the Company are responsible for the preparation and presentation of the Remuneration Report in accordance with Section 300A of the Corporations Act 2001. Our responsibilities We have audited the Remuneration Report included in pages 55-75 of the Directors’ report for the year ended 30 June 2023. Our responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards. KPMG David Kells Partner Julia Gunn Partner Sydney 16 August 2023 Shareholders' information
As at 31 July 2023
Ordinary share capital
There were 1,038,561,895 fully paid ordinary shares held by 12,266 shareholders. All the shares carry one vote per share and carry
the rights to dividends.
Distribution of shareholders
The number of shareholders by size of holding are as follows:
Range
100,001 and over
10,001 to 100,000
5,001 to 10,000
1,001 to 5,000
1 to 1,000
Total
No. of holders
No. of shares
% of issued capital
390
1,823
1,332
3,671
5,050
12,266
964,145,601
53,404,259
9,625,458
9,242,322
2,144,255
92.83%
5.14%
0.93%
0.89%
0.21%
1,038,561,895
100.00%
There were 283 shareholders holding less than a marketable parcel based on a market price of $5.83 at the close of trading on
31 July 2023.
Twenty largest shareholders
Name
HSBC Custody Nominees (Australia) Limited
J P Morgan Nominees Australia Pty Limited
Citicorp Nominees Pty Limited
Mr James Alexander Angelis
National Nominees Limited
Citicorp Nominees Pty Limited
Mackay Insurance Services Pty Ltd
BNP Paribas Noms Pty Ltd
Argo Investments Limited
BNP Paribas Nominees Pty Ltd Hub24 Custodial Serv Ltd
Mackay Insurance Services Pty Ltd
HSBC Custody Nominees (Australia) Limited - A/C 2
HSBC Custody Nominees (Australia) Limited
Outland Investments Pty Ltd
Steadfast Share Plan Nominee Pty Ltd
BNP Paribas Nominees Pty Ltd
RC & IP Gilbert Pty Ltd
NewEconomy.Com.AU Nominees Pty Ltd
HSBC Custody Nominees (Australia) Limited
Mr Robert Bernard Kelly
Total
No. of shares
% of issued capital
306,627,741
179,183,316
123,187,785
45,923,468
44,338,206
35,497,788
27,525,392
20,126,533
14,904,109
8,346,806
7,691,016
4,516,554
4,477,315
3,686,734
3,341,202
3,055,946
3,000,000
2,933,075
2,883,154
2,789,878
29.52%
17.25%
11.86%
4.42%
4.27%
3.42%
2.65%
1.94%
1.44%
0.80%
0.74%
0.43%
0.43%
0.35%
0.32%
0.29%
0.29%
0.28%
0.28%
0.27%
844,036,018
81.27%
Steadfast Group Annual Report 2023 135
Shareholders' information continued
Substantial shareholders
Name
Vanguard Group
First Sentier Investors Holdings
Date of notice
No. of shares
% of issued capital
30 March 2023
9 March 2023
52,068,661
62,869,101
5.01%
6.05%
This information is based on the most recent substantial holder notices lodged with the ASX.
Securities purchased on-market
The following securities were purchased on market during the financial year for the purpose of the dividend reinvestment plan:
Ordinary Shares
Dividend details
Number of
shares purchased
Average price paid
per share
414,316
$5.81
Dividend
Interim
Final
Franking
Fully franked
Fully franked
Amount per share
DRP issue price
Payment date
6.0 cents
9.0 cents
5.80 cents1
22 March 2023
2
21 September 2023
1 The Group provided shares under the DRP through an on-market purchase.
2 The DRP issue price of the final dividend is scheduled to be announced on 31 August 2023.
The final dividend has an ex-dividend date of 21 August 2023, a record date of 22 August 2023, a payment date of 21 September
2023 and is eligible for Steadfast's DRP which carries no discount.
136 Steadfast Group Annual Report 2023
Glossary of terms
Term
AGM
Carbon neutral
CGU
Client
CPS
DEA
DPS
DRP
EBITA
ECL
EPS
EPS (NPAT)
EPS (NPATA)
Equity brokers
FY
Group
GWP
Hubbing
IFRS
KMP
KPIs
LTI
NCI
Network
Network broker
Non-trading items
NPAT
NPATA
PSF
Rebate
Return on capital (ROC)
SCTP
Explanation
Annual General Meeting
Carbon neutral means bringing net carbon emissions to zero through a combination of
reducing emissions and carbon offsetting
Cash-generating unit
Customer of broker/underwriting agency
Cents per share
Deferred equity award
Dividend per share
Dividend Reinvestment Plan
Earnings before interest (including premium funding interest income and expense), tax and
amortisation. To ensure comparability, underlying EBITA also deducts the interest expense
on lease liabilities and depreciation of right-of-use assets
Expected credit loss
Earnings per share
Earnings per share that reference NPAT
Earnings per share that reference NPATA
An insurance broker that is a member of the Steadfast Network, where Steadfast holds an
equity interest
Financial Year
Steadfast Group Limited (ABN 98 073 659 677, AFSL 254928) and its controlled entities,
associates and joint ventures
Gross written premium – the amount paid by customers for insurance policies excluding
taxes and levies
The merger of two or more insurance intermediary businesses
International Financial Reporting Standards
Key management personnel
Key performance indicators
Long-term incentive
Non-controlling interests
The collective reference to the distribution network that comprises all Steadfast
Network brokers
An insurance broker who is a member of the Steadfast Network, where Steadfast has no
equity interest
Includes revenue and/or expense items that are typically one-off in nature and are not
reflective of the Group’s normal operating activities
Net profit after tax
Net profit after tax (post non-controlling interests) adjusted for amortisation of
customer relationships
Professional services fee
An annual payment made to Steadfast Network brokers, at the discretion of the Board
Underlying net profit after tax (adjusted to remove impact of the IBA acquisition in FY23 and
Coverforce acquisition in FY22) as a percentage of opening shareholders' equity attributable
to the owners of Steadfast Group Limited
Steadfast Client Trading Platform – a web based platform that is a digitally contestable
market place providing Steadfast Network brokers access to obtain multiple, detailed
quotes from a variety of insurers, with only one data input as well as place and maintain
policy contracts
Steadfast Group Annual Report 2023 137
Glossary of terms continued
Term
SME
STI
Explanation
Small to medium enterprise
Short-term incentive
Strategic partner
Preferred product partners underwriting or arranging the general insurance policies and
premium funding products which are placed by Steadfast Network brokers
TSR
Total shareholder return
Trapped Capital
Underlying earnings
Underlying NPAT
Underwriting agency
Warehouse Trust
A project initiated by the Group to offer Network members the ability to sell equity in their
business to the Group
Underlying earnings refers to statutory earnings adjusted for non-trading items
Underlying NPAT refers to statutory NPAT adjusted for non-trading items
Underwriting agencies act on behalf of general insurers to design, develop and provide
specialised insurance products and services for specific market segments
A Warehouse Trust is a secured lending facility whereby the collateral is a pool of loans
receviable rather than an individual property or asset
138 Steadfast Group Annual Report 2023
Corporate directory
Directors
Frank O’Halloran AM (Chair)
Robert Kelly AM (Managing Director & CEO)
Vicki Allen
Joan Cleary
David Liddy AM
Gai McGrath
Greg Rynenberg
Company secretaries
Linda Ellis (leaving 31 August 2023)
Duncan Ramsay
Peter Roberts
Notice of the AGM
The AGM will be held on Friday, 27 October 2023.
Corporate Office
Steadfast Group Limited
Level 4, 99 Bathurst Street
Sydney NSW 2000
Postal Address
PO Box A980
Sydney South NSW 1235
P 02 9495 6500
E investor@steadfast.com.au
W steadfast.com.au
ACN 073 659 677
Share registry
Link Market Services
Level 12, 680 George Street
Sydney NSW 2000
Postal Address
Locked Bag A14
Sydney South NSW 1235
P 1300 554 474
E registrars@linkmarketservices.com.au
Stock Listing
Steadfast Group Limited ordinary shares are listed
on the Australian Securities Exchange (ASX code: SDF).
Steadfast Group Annual Report 2023 139
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